Following the lowest point in nine months for crude prices, OPEC+ is getting close to reaching a decision to postpone an increase in oil output scheduled for October, two sources within the producers group told Reuters on Thursday.
Due to concerns about a faltering global economy and soft data from China, the largest oil importer in the world, oil prices have been declining along with those of other asset classes.
According to one of the sources, “it is likely that the countries will take action to balance the market by delaying the increase.” According to the second source, OPEC+ was “almost there” in reaching a consensus.
Due to the potential delay, oil prices increased. On Thursday, benchmark Brent crude reached $73 per barrel, although it is still near its lowest point since December.
Increasing production would cause a significant surplus in the market starting in the first quarter of 2025. However, delaying could be seen as OPEC’s tardy acknowledgement of the weak oil demand. Helima Croft, an analyst at RBC Capital, suggested in a note that it might be wise for OPEC+ to hold off on returning more barrels until December.
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