In what would be the biggest move yet since the COVID-19 pandemic to address oil market weakness, OPEC+ will consider an oil output cut of more than a million barrels per day (bpd) next week, OPEC sources said on Sunday.
The meeting will take place on October 5 against the backdrop of falling oil prices and months of severe market volatility, which prompted top OPEC+ producer Saudi Arabia to say the group could cut production.
OPEC+, which combines OPEC countries and allies such as Russia, has refused to raise output to lower oil prices despite pressure from major consumers, including the United States, to help the global economy.
Prices have nevertheless fallen sharply in the last month due to fears about the global economy and a rally in the US dollar after the Federal Reserves raised rates.
A significant production cut is poised to anger the United States, which has been putting pressure on Saudi Arabia to continue pumping more to help oil prices soften further and reduce revenues for Russia as the West seeks to punish Moscow for sending troops to Ukraine.
The West accuses Russia of invading Ukraine, but the Kremlin calls it a special military operation.
Saudi Arabia has not condemned Moscow’s actions amid difficult relations with the administration of US President Joe Biden.
Last week, a source familiar with the Russian thinking said Moscow would like to see OPEC+ cutting 1 million bpd or one per cent of global supply.
That would be the biggest cut since 2020 when OPEC+ reduced output by a record 10 million bpd as demand crashed due to the COVID pandemic. The group spent the next two years unwinding those record cuts. – Agencies