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24th OPEC and non-OPEC Ministerial Meeting to take place


24th OPEC and non-OPEC Ministerial Meeting to take place

Photo: Dado Ruvic/Reuters

The 24th OPEC and non-OPEC Ministerial Meeting will be held today in Vienna, Austria.

Concerns over the economic impact of the Omicron variant combined with already existing shipping and supply chain issues have caused already high oil prices to rise sharply in the past two months. Both oil production and shipping have slowed, and governments with large emergency inventories like the U.S. and Russia have been hesitant to release any further supplies than they already have.

Expect the OPEC and non-OPEC countries to proceed with their plan to increase production by 400,000 barrels per month in January; the move was agreed to in December to stabilize the rising oil prices caused by low supply and global supply remains low. However, this may not be enough in short to medium term as some member countries are struggling to meet production targets, due to unrest in some cases and infrastructure issues in others, and have asked that their compensation periods be extended until June. In the longer term, expect the extended period of high oil prices, which has persisted since the beginning of the pandemic, to hasten the private sector’s move towards green energy and carbon neutral companies.

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