The 180th meeting of the Organization of the Petroleum Exporting Countries (OPEC) Conference will be held today in Vienna, with
The 180th meeting of the Organization of the Petroleum Exporting Countries (OPEC) Conference will be held today in Vienna, with an OPEC+ meeting set for tomorrow.
Today’s meeting will discuss mounting uncertainties about the oil market’s ability to handle surplus oil output expected in January. Since the beginning of the COVID-19 pandemic, production quotas have been reduced to account for lower demand for oil. Uncertainty has led to instability in the oil market and a sharp drop in oil prices. While the market partially recovered as COVID-19 restrictions were lifted, worldwide lockdown re-implementations have driven demand down again. Additionally, the recent end to major hostilities in Libya has increased oil the country’s production dramatically. Critics warn these two factors may cause oil surpluses, further destabilising the market.
The majority of OPEC and OPEC+ members (including Russia and nine other countries) have advocated for a continued reduction in production quotas to avoid surpluses, and this desire is likely to be upheld following this meeting. Despite this, some exporting nations—notably Iraq, Nigeria and the UAE—have expressed consternation about the idea. While these complaints are unlikely to overturn the final decision, any disagreement could threaten a united response to further industry headwinds.