OPEC+ Holds December Oil Output Targets as Iran War Disrupts Supply

OPEC+ agreed on Sunday to keep its oil output targets for December unchanged, the third straight monthly pause, as the war involving Iran continues to disrupt supply from the Gulf.

The seven core members, Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman, met online and left their targets at the levels set for September to November. Their combined target is about 31 million barrels a day. The group finished unwinding 1.65 million barrels a day of voluntary 2023 cuts in September, while a further 2 million barrels a day of 2022 cuts remain in place until the end of the year, according to The National.

The decision changes little in practice. The Strait of Hormuz, which normally carries about a fifth of the world’s crude oil and liquefied natural gas, has been effectively shut since the US-Iran conflict began on 28 February. Most members are pumping below their targets because of the war, and attacks on ships in and around the strait reached a war-high in October.

Oil prices eased on Monday. Brent crude traded near $110 a barrel, down about 3 percent, after Iran’s foreign minister said a Qatari-brokered plan could reopen the strait within days. Iran attached conditions, including the lifting of US sanctions, and Washington has not publicly responded.

OPEC+ is reviewing member production capacity to set baselines for 2027. All members are due to meet again on 29 November, and analysts say no further changes to oil output targets are expected before next year.

Source: The National, FinanceFeeds