OPEC+ agrees to delay December oil output increase

OPEC+ announced on Sunday that it will delay the planned December voluntary output increase by one month.

Last week there was a report that this was on the table so it’s not a big surprise. If anything, the oil market could be disappointed that it wasn’t extended for more than a month.

I expect any market reaction to be limited with the focus on the US election and China stimulus announcements that are expected Nov 8.

Brent closed Friday at $73.10.

Here is the statement:

The OPEC Secretariat noted that the eight OPEC+ countries Saudi
Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan,
Algeria, and Oman, which previously announced additional voluntary
adjustments in April and November 2023, have agreed to extend the
November 2023 voluntary production adjustments of 2.2 million barrels
per day for one month until the end of December 2024.

In addition, the eight countries reiterated
their collective commitment to achieve full conformity with the
Declaration of Cooperation, including the additional voluntary
production adjustments that were agreed to be monitored by the JMMC
during its 53rd meeting held on April 3rd 2024, and to fully compensate
by September 2025 for the overproduced volumes since January 2024 in
accordance with the compensation plans submitted to the OPEC
Secretariat.

The countries also noted the recent announcement made by Iraq and
the joint statement made by Russia and Kazakhstan, in which they
strongly reaffirmed their commitment to the agreement including the
additional voluntary production adjustments and to their compensation
schedules for the overproduced volumes since January 2024.

This article was written by Adam Button at www.forexlive.com.