ORGANIZATION of the Petroleum Exporting Countries Plus (Opec+) is considering pushing back a series of monthly supply increases due to begin in April despite calls from US President Donald Trump to lower prices, delegates said.
Global oil markets remain too fragile to revive production now, said one of the delegates, who asked not to be identified as the talks are private. No decision has been made yet and the group is split on how to proceed, said another. A decision may be finalised in the coming weeks.
Postponing the modest hike of 120,000 barrels a day would mark the fourth time that the alliance led by Saudi Arabia and Russia has delayed plans to revive production halted since 2022.
The coalition currently aims to restore a total of 2.2 million barrels per day in monthly increments by late 2026. Russia’s Deputy Prime Minister Alexander Novak said on Monday (Feb 17) that this time frame “remains the same” and there have not yet been any discussions on a deferral.
Trump has urged the Opec to “cut the price of oil”, reprising a theme of his first term. Yet at US$74 a barrel, prices remain too low for many Opec members to cover government spending, and last week the group’s Secretary-General said its decisions will prioritise “the longer-term” impact.
“Fundamentally, you can present a case for a supply return in April,” said Harry Tchilinguirian, head of oil research at Onyx Commodities. But “let’s get real: the oil price will determine the decision”.
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In a report last week, Opec’s Vienna-based secretariat also warned about the dangers posed by US trade tariffs. The measures “added more uncertainty into markets, which has the potential to create supply-demand imbalances that are not reflective of market fundamentals, and therefore generate more volatility”.
Kazakhstan, one of several alliance members that have been slow to implement their agreed cutbacks, assured the group’s leaders it will take further measures to fulfil its obligations. Energy Minister Almassadam Satkaliyev held telephone calls with Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman, Russian Deputy Prime Minister Alexander Novak and Opec Secretary-General Haitham Al-Ghais, the Energy Ministry said on Monday.
The Opec+ alliance first unveiled its plans for gradually reviving production in June last year, but with oil demand growth slowing in China and new supplies across the Americas swelling, it has been forced to postpone the roadmap three times.
Proceeding with the increases would threaten to swell an anticipated oil surplus. Even if Opec+ keeps output unchanged, global supplies will exceed demand this year by an average of 450,000 barrels per day this year, according to the International Energy Agency (IEA) in Paris. JPMorgan Chase and Citigroup see prices sinking into the US$60s before the end of 2025.
“I guess Trump will not be happy, but Opec+ would surely be right to hold their fire,” said Neil Atkinson, an independent analyst and former head of the IEA’s oil markets and industry division. “On current supply-demand balances, the market doesn’t really have room for more oil.” BLOOMBERG
