MEOG: OPEC+ makes a cut

The OPEC+ group of oil producers last week met to decide their next production quotas, electing to row back on last month’s increase in the wake of falling prices and demand concerns.

As expected, the 100,000 barrel per day (bpd) uptick added in August was removed again on September 6, with the group saying it would meet again on October 5. In a press release published by OPEC, the group noted “the adverse impact of volatility and the decline in liquidity on the current oil market and the need to support the market’s stability and its efficient functioning”.

It reiterated its “readiness to make immediate adjustments to production in different forms, if needed”. The caution comes amid concerns about global recession and the apparently increasing likelihood of Iranian crude returned to the market.

The quota cut is the group’s first for 18 months and follows months of over-compliance with quotas – underproduction – as members struggle to add to output as they max out capacity and Russian levels are depressed by domestic economic issues and other sanctions-related issues.