Reuters reports three sources from within the OPEC+ group as saying that the cartel will discuss the option of making production cuts to support oil prices.
The various members of the group have committed to cutting production by 5.16 million bpd (barrels per day), with this including sizeable voluntary cuts by Russia and Saudi Arabia.
This represents about 5% of the oil that the world consumes every day. Nevertheless, despite the ongoing war in Ukraine and fears about stability in the Middle East, the price of Brent Crude has dropped from a high of about $98 per barrel in September, to about $80 at the time of writing.
Reuters cites one source as saying that the current cuts may be deemed insufficient to ensure market stability, so at the next OPEC+ meeting, the members may look at how more could be done.
One OPEC+ source said to Reuters:
“It is not pleasant to see that market volatility is greater ahead of the next meeting while fundamentals overall remain solid. Ministers are likely to express some thoughts on what to do more, to secure a stable trend.”
While the OPEC+ group has been limiting oil production, production has been allowed to increase elsewhere. For example, US oil companies like ExxonMobil and Chevron, the makers of the Mobil and Texaco grease ranges, have helped the US to reach record levels of production.
Further OPEC+ production cuts may be controversial, because it has consequences for the oil revenues that its members generally rely on as a primary source of income.