Reuters quoted three representatives of the Organization of the Petroleum Exporting Countries and partner countries (OPEC+) on Monday (30th) as saying that OPEC+ may recommend maintaining the current production policy when it holds an online meeting on Wednesday (2/1). In addition, Russian President Vladimir Putin discussed OPEC+ cooperation on the phone with Crown Prince Mohammed bin Salman, who is actually in power in Saudi Arabia, on the same day.
In addition, the OPEC+ Joint Ministerial Monitoring Committee (JMMC) meeting was originally scheduled to be held on Tuesday (1/31) after the OPEC+ Joint Technical Committee (JTC) meeting, but people familiar with the matter said the plan has been cancelled. The JTC advises the JMMC and the overall OPEC+ ministerial meeting on a market basis. However, the JMMC can still call a full meeting if necessary.
Meanwhile, Russian President Vladimir Putin and Saudi Arabian Crown Prince Mohammad Salman on call ahead of OPEC+ ministerial meeting. According to a statement from the Kremlin on Monday, the two leaders discussed cooperation within OPEC+ to stabilize the operation of the oil market, and the two sides also discussed cooperation in the fields of politics, economy, trade and energy.
Five OPEC+ sources previously told Reuters last week that the JMMC would discuss the economic outlook and the size of Chinese demand and was unlikely to recommend adjustments to current oil production policy. With oil prices rebounding this year, policy changes are unlikely, one of the sources said.
“There’s no real storm in the ship right now, so why shake things up?” said Ole Hansen, head of commodity strategy at Saxo Bank. And its impact on supply, OPEC+ may want to buy some time.
OPEC+ agreed in October last year to cut its production target by 2 million barrels per day, or about 2 percent of global demand, from November of the same year to the end of 2023.
Before the time of writing, Brent crude oil futures due in March fell 0.88% to $85.90 a barrel; West Texas Intermediate crude futures due in March fell 0.78% to $79.06 a barrel.
