OPEC+ Meeting Preview: Another 400k bpd Production Increase
In today’s online meeting, OPEC+ is expected to agree to another production increase of 400,000 barrels per day, a move which is a continuation of the process of rolling back production cuts introduced in the depths of the Covid-19 crisis. The organization expects supplies to remain tight through the rest of the year, before flipping to a surplus in 2022. Oil is trading slightly higher this morning ahead of the decision.
Below, courtesy of Newsquawk, is a detail summary of what to expect in today’s meeting
SUMMARY
- The JTC will meet on Tuesday at 12:00BST/07:00EDT; JMMC and OPEC+ will meet on Wednesday at 15:00BST/10:00EDT and 16:00BST/11:00EDT respectively – subject to further delays
- Sources have suggested that the planned 400k BPD hike output will likely go ahead, although surprises cannot be ruled out
RECENT COMMENTARY
- Kazakhstan considers the existing OPEC+ decisions as sufficient to stabilise the market, TASS reported
- The Kuwati oil minister, over the weekend, suggested OPEC+ could reconsider output increase due to COVID
RECENT SOURCES
- OPEC+ is likely to roll over its output policies this week, with a planned 400k BPD hike from September, according to sources
- An informed source has intimated that considering the outcome of the JTC meeting yesterday, it appears that the OPEC plus meeting today will continue its previous policy; i.e. an increase of 400k BPD, via Energy Journalist Zandi
- OPEC+ focus remains on an increase of 400k BPD despite the upward revision to demand forecast, according to four sources
- Sources have said “current oil prices around $70 are okay.”
JTC FORECASTS
- OPEC+ forecasts oil stocks falling in 2021 even as it raises production, according to reports – If output is fully restored, the group forecasts a new oil surplus next year
- OPEC+ JTC revises figures and now sees OECD stocks below 2015-2019 average until May 2022 (prev. Jan 2022)
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