OPEC and its allies, including Russia, are expected to pass a significant cut in oil production to raise prices when officials meet in Vienna on Wednesday.
Among those likely to attend the meeting was Russian Deputy Prime Minister Alexander Novak, who has played a key role in promoting cooperation with the Organization of the Petroleum Exporting Countries. The presence of Mr Novak, who is under US sanctions, could confound European officials as their citizens face a difficult winter because of Russia’s war in Ukraine.
Huge cuts to the order of two million bpd, or about 2% of world supply, are likely to come, analysts say.
The group’s gathering, known as OPEC Plus, is the first to be held in person since the early days of the pandemic. According to analysts, that shows the intention to make a strong statement to the energy markets about the group’s cohesion in the fighting in Ukraine and the willingness to act quickly to protect prices. .
But the meeting also took place against a backdrop of shifting political intentions and economic factors.
inside push oil prices higherThe Kremlin may be using OPEC’s de facto leader, Saudi Arabia, whose ministers want future cooperation from Moscow on energy issues, to cost the West. more in taking measures against Russia.
Bhushan Bahree, chief executive officer of S&P Global Commodity Insights, said: “In the range of rising prices, Europe’s move to impose sanctions on Russian oil in December will make Europe more of a challenge.
A significant production cut would be a blow to the Biden administration, which has already Lobbying for the Saudis to increase production. Saudi officials expressed concern that oil demand could weaken due to the growing world economy.
“They are looking for ways to surprise the market or deliver at least as much as the market predicts,” said Richard Bronze, head of geopolitics at Energy Aspects, a research firm in London.
Expectations of a big move by producing countries in recent days have helped lift the price of Brent crude oil futures, the international benchmark, to around $92 a barrel from about $83.
The group may also announce that it is expanding the overall cooperation agreement between OPEC, Russia and other producing countries, which is due to expire in December.