OPEC+ Expected to Maintain Output Policy at Panel Meeting, According to Reuters

By Alex Lawler, Ahmad Ghaddar, and Maha El Dahan

LONDON/DUBAI – A ministerial panel of OPEC+ is set to convene on Wednesday, and sources indicate that it is unlikely to propose any changes to current policy. This would allow the group to start gradually ramping up production by December.

The Organization of the Petroleum Exporting Countries, along with its allies led by Russia—collectively known as OPEC+—will hold an online meeting of the Joint Ministerial Monitoring Committee (JMMC) at 1200 GMT.

According to two sources familiar with the matter, no unexpected announcements are anticipated from the meeting. One insider noted that the focus will likely be on reaffirming the necessity for member nations to adhere to their production targets as outlined in their existing agreements.

International oil prices dipped below $70 a barrel in September for the first time since late 2021 but have since seen a modest recovery. Prices have risen approximately 5% this week to over $75 amid concerns that escalating tensions in the Middle East, particularly following Iran’s recent military strike against Israel, could potentially impact crude output from the area.

OPEC+ has been implementing output cuts totaling 5.86 million barrels per day (bpd), equivalent to about 5.7% of global demand, following a series of agreements made since late 2022. The group plans to increase production by 180,000 bpd in December as part of a gradual lift of recent voluntary cuts by 2025. This increase was postponed from October due to the earlier drop in prices.

The compliance of member countries will be a key topic during the meeting and in the coming weeks, especially concerning Iraq and Kazakhstan, both of which have committed to make compensation cuts totaling 123,000 bpd in September and additional reductions in subsequent months to offset prior overproduction.

An OPEC+ source recently stated that confirming whether the compensation cuts were executed in September would facilitate the December increase. However, inadequate compliance could lead Saudi Arabia and other producers to accelerate the unwinding of their cuts starting in December, according to analysts.

"If they fail to comply, we can envision a swifter end to the voluntary cuts," noted Helima Croft from RBC Capital in a report.

The JMMC, which includes oil ministers from Saudi Arabia, Russia, and other major producers, typically meets every two months and has the authority to recommend changes to policy.