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Iraq does not have any expectations about the outcome of the Dec. 2 meeting of OPEC+ ministers, the country’s oil minister told the state-run Iraqi News Agency, as the 23-member coalition is set to assess the impact of the oil price crash on Nov. 26, a new COVID variant and the coordinated release of oil stocks from major consumers.
“Member countries will wait for reports on market research that give a clear view and the decision will be based on what the technical experts present,” Ihsan Ismaael told the agency on Nov. 27.
OPEC+ is weighing its supply options after the US-led attempt to lower prices by releasing stocks has been complicated by a major sell-off on resurgent demand fears on a new COVID variant.
Some coalition members are still calling for an aggressive response to the coordinated 70 million-barrel Strategic Petroleum Reserve release, which is equivalent to about two days of OPEC+ output. Such a strategy would risk inflaming already tense relations with the US, where crude trading over $80/b has been blamed for inflation surging to a 31-year-high of 6.2% and gasoline selling for over $4 a gallon in some parts of New York.
Since July, OPEC and its Russia-led allies have been raising crude quotas by 400,000 b/d each month, a gradual pace that has allowed them to support oil prices while largely keeping a US shale rally in check. Many forecasters and strategists now warn that continuing to increase output will leave the market oversupplied come January, especially if the Northern Hemisphere winter brings more COVID-19 lockdowns.
Fears over new lockdowns due to the new southern African COVID-19 variant caused crude prices to collapse on Nov. 26. S&P Global Platts assessed Dated Brent at $73.27/b that day, down 11% on the day and the lowest in two months.
The OPEC+ talks will begin with a delegate-level technical advisory committee meeting Nov. 29, followed by the ministerial monitoring committee co-chaired by Saudi Arabia and Russia convening on Nov. 30.
OPEC ministers will then meet Dec. 1, before inviting Russia and nine other partners in the OPEC+ coalition to talks on Dec. 2.
