The Joint Ministerial Monitoring Committee (JMMC) of OPEC+ did not decide to change production policy at its virtual meeting yesterday, Commerzbank’s commodity analyst Carsten Fritsch notes.

OPEC+ keeps production policy intact

“The JMMC of OPEC+ did not decide to change production policy at its virtual meeting yesterday This had already been expected from statements made by informed sources in the run-up to the meeting. This means that the planned gradual increase in oil production from the 4th quarter onwards will remain in place for the time being.”

“Whether this will actually happen, however, depends on market conditions, as representatives of Saudi Arabia and Russia have repeatedly emphasized. The 8% drop in oil prices since mid-July, triggered by demand concerns, is likely to have made OPEC+ aware of how ambitious the intended supply increase is, should demand grow less strongly than expected.”

“The last word on this has therefore not yet been spoken. Iraq, Kazakhstan and Russia have once again pledged to fully comply with the agreed production cuts. So far, this has not happened despite repeated assurances. Iraq in particular has continued to produce significantly more than agreed until recently.”