LONDON: OPEC+ agreed on Wednesday to stick to moderate rises in its oil output with the group already struggling to meet existing targets and wary of responding to calls on its strained capacity for more crude from top consumers to cap surging prices.
The Organization of the Petroleum Exporting Countries and allies led by Russia, a group known as OPEC+ which produces more than 40% of global oil supply, has faced calls from the United States, India and others to pump more oil as economies recover from the pandemic.
But OPEC+ has stuck to its target of monthly increases of 400,000 barrels per day (bpd) and blamed surging prices on the failure of consuming nations to ensure adequate investment in fossil fuels as they shift to greener energy.
Several OPEC+ sources also said prices had been pushed up by Russia-U.S. tensions. Washington has accused Moscow of planning to invade Ukraine, which Russia denies.
OPEC's share of Indian oil imports falls to lowest in at least 15 years
“We are living the Olympic spirit and therefore we broke the record for the meeting concluding it in 16 minutes,” Saudi Energy Minister Prince Abdulaziz bin Salman told the meeting, according to a source who heard him during the shorter than usual online gathering.
OPEC+ oil output increases are complicated by the fact that several OPEC members have struggled to meet even current monthly targets and lack spare capacity to boost production any further.
Only a handful of states, notably Saudi Arabia, have some spare capacity that could help boost the overall output level of OPEC+. But starting that up might drive oil prices higher still, as it would remove a safety cushion in case of any global shock.
Many OPEC watchers and analysts compared today’s situation to the 2007-2008 crisis when oil rallied to an all-time high of $147 a barrel when OPEC lacked extra oil supplies to meet soaring Chinese demand.
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