The meetings of the OPEC and OPEC + tables in general will take place as planned on Wednesday and Thursday and ministers will decide whether to go ahead with the planned production increases.
OPEC, led by Saudi Arabia, joined producers like Russia in cutting production last year when the coronavirus wiped out demand for oil.
OPEC + has agreed to increase by 400,000 barrels per day for each month. The group left scope to halt those increases in case factors such as virus outbreaks hurt demand.
The postponement of the meetings will give the group time to analyze the market after a price drop of more than 13% last Friday, following the outbreak of the new Omnicron variant that scared investors and traders.
OPEC will also assess the potential impact of the planned 50 million barrel release by the United States and other crude-importing nations from their strategic oil reserves.
Analysts estimate that oil exporting nations will adopt a cautious stance to determine whether to continue with the original production scheme.
WTI tumbled more than 13% on Friday, falling below $ 70 for the first time since September, and Brent had its seventh steepest drop above 11.5% after the Omicron variant spooked traders afterward. Thanksgiving holiday.
OPEC + will finally decide next Thursday what the level of production will be from next year.
The question is whether, under current conditions, OPEC + will continue with its plan that has been in place since August, to increase crude oil pumps gradually, at a rate of 400,000 barrels a day each month, until next September.
In that period, it is projected that some 3.8 million barrels per day will be added to the market that is still underground, from the large cut of almost 10 million barrels agreed in April 2020, to compensate for the historical collapse in demand, triggered by the coronavirus crisis.
Source From: Ambito
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