The OPEC+ group’s Joint Ministerial Monitoring Committee (JMMC) recommended on Wednesday that the alliance cut 2 million barrels per day (bpd) of output by November, according to multiple sources after the committee meeting ended .
The full OPEC+ ministerial meeting will begin soon.
Earlier reports suggested that OPEC+ would discuss a production cut of between 500,000 bpd and 1 million bpd at today’s meeting. Most analysts were leaning toward predicting a cut of 1 million bpd. Then on Tuesday, more reports emerged that OPEC+ could discuss a cut of up to 2 million bpd.
Just before the start of the JMMC and OPEC+ meeting, the most widely reported figure was a cut of 1.8 million bpd.
The actual OPEC+ output cut could be much smaller, given that the alliance is estimated to be about 3.6 million bpd below its output target.
Meanwhile, the White House was reportedly up in arms to try to avoid a potentially major OPEC+ production cut just a month before the midterm elections, when the current administration least needs higher prices in the bomb
Arriving at the OPEC+ meeting in Vienna, the alliance’s first face-to-face meeting since March 2020, Suhail Al Mazrouei, Energy Minister of the United Arab Emirates (UAE), said OPEC+ is a “technical organization,” when asked whether US-UAE relations are at risk of being damaged by the proposed big cut.
Most OPEC+ producer officials said any cuts would be a “technical decision not a political one” and cited a “recession risk” from the cuts as they entered OPEC headquarters in Vienna.
After Tuesday’s recovery, oil prices were mostly flat and indecisive on Wednesday as the market awaits the final decision and official communication from OPEC+ after the meeting ends. Brent crude was up 0.32% at $92.00 by 9:13 a.m. ET. The US benchmark rose 0.23% to $86.66.
By Charles Kennedy for Oilprice.com
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