The Saudi oil minister and chair of the OPEC Plus meetings Prince Abdulaziz bin Salman have agreed to stick to its last production agreement of increasing oil production on ta monthly basis.
Officials from OPEC, Russia and other oil-producing countries decided on Wednesday to stick to their July agreement of increasing production each month by 400,000 barrels a day, a modest amount equivalent to less than 1 percent of global supply.
Analysts say the group is concerned about the future health of oil market as the pandemic continues to inject uncertainty into the global economy, but officials did not see an urgent need to make changes.
In a brief statement issued after the meeting, OPEC Plus said that although the effects of “the pandemic continue to cast some uncertainty, market fundamentals have strengthened.”
OPEC Plus has also come under pressure from the Biden administration to pump more oil.
In addition, oil prices are at comfortable levels. They have risen through much of this year as pandemic lockdowns eased and economies began a boisterous expansion.
Prices fell sharply after the July agreement, causing concern that the production increase was too much, but they have recovered to about $71 a barrel for Brent crude, the global benchmark.
The meeting was the first after an arduous series of negotiating sessions in July that led to the deal to increase production by 400,000 barrels a day in each of the coming months. The producers also resolved a dispute with the United Arab Emirates over production ceilings.
If the supply increases continue as planned, OPEC Plus will add about two million barrels a day of oil to the market by year end. But there is doubt about whether the member states will have the ability to add the full amount.