Opec+ members discuss delay to planned output increase

Opec+ members are discussing the possibility of delaying a planned increase in production next month, according to sources.

The potential move follows a steep fall in oil prices in recent days against a backdrop of an increasingly poor Chinese economic outlook and despite an ongoing oil blockade in Libya.

Front-month Ice Brent crude futures closed at $73.75/bl on 3 September, down from over $81/bl at the start of last week and the lowest since around mid-December last year.

Eight members of the group — Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria and Oman — had planned to start unwinding 2.2mn b/d of "voluntary" cuts over a 12-month period starting in October, as agreed at a meeting in June. The alliance made it clear at the time of the June meeting that the return of this output would be dependent on market conditions. But up until now, market observers and delegates had expected production to rise as planned.

"[We are] now having a discussion on a possible delay of the monthly adjustment a bit," one delegate source told Argus. A second source confirmed that the talks are underway and a third said the group is at an "everything is possible point".

Asked about a timeframe for any delay, one source said it could be until December when Opec+ has a scheduled in-person ministerial meeting in Vienna.

By Bachar Halabi, Nader Itayim and Aydin Calik