World’s some of the most powerful oil producers plan to meet on Wednesday to discuss how much the new Omicron Covid variant might affect energy demand.
OPEC, The Organization of Petroleum Exporting Countries, led by Saudi Arabia, should hold a meeting via video conference at 1 pm., London time. On Thursday, Russia and other non-OPEC allies are planning to join the 13-member group too.
Experts and analysts expect this wide organization OPEC+ to discuss and change its current output plan to increase production by 400,000 barrels per day.
OPEC ministers representing Saudi Arabia and Iraq said that the organization might maintain this production policy. On the opposite, non-OPEC leader Russia thinks there is no need for urgent action on the oil market.
However, some analysts questioned whether OPEC+ might be suspended to assess the market. They cited increased price volatility and concerns that omicron variants may impact energy demand.
Suppose OPEC+ oil-producing countries promote production increases. In that case some OPEC+ oil-producing countries may have difficulty reaching their quotas next month.
OPEC’s November daily production was 27.74 million barrels. This is an increase of 220,000 barrels from October. However, the number is lower than the OPEC+ agreement allowed OPEC member states to increase (254,000 barrels).
On Wednesday afternoon, the international benchmark Brent crude oil futures traded at US$72.62 in London. This is an increase of more than 4.8% that day. At the same time, the US West Texas Intermediate crude oil futures price was US$69.24, which is a 4.6% increase.
Oil prices have fluctuated in recent days. Brent and WTI futures contracts are likely to record their largest monthly declines since March last year and fall by 16% and 21%, respectively.
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