The meeting of seven core OPEC+ members — Saudi Arabia,
Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman — comes as the US-Israel
war on Iran continues to disrupt oil exports through the Strait of Hormuz,
limiting OPEC+'s influence over prices and
market share.
In August, OPEC+ agreed its production boost for September,
completing a phased rollback of a 1.65 million barrel per day supply cut first
agreed in 2023.
Despite
the agreed production increases, the group made up of the Organization of the
Petroleum Exporting Countries and its allies, including Russia, still produces
far below its targets because of the war.
"OPEC+ currently has very limited power over the
physical oil market," said Jorge Leon of Rystad Energy. "The group
can change production targets on paper, but it cannot guarantee that those
barrels will be produced or actually reach
the market."
"The focus now shifts away from monthly production
adjustments and towards the much more consequential debate over 2027."
OPEC+ still has another layer of production cuts in place,
covering most members of the 21-country group until the end of 2026. Before the
group decides how to unwind the cuts and return production to the market, it needs to
review members' oil production capacity to set 2027 output baselines, which
form the basis for quotas.
This debate will likely happen later in 2026 and hence
OPEC+ is likely to pause its
output increases for the fourth quarter, sources earlier told Reuters. The
statement on Sunday made no mention of policy beyond October.
Only the seven OPEC+ members who met on Sunday, plus the United Arab Emirates until
it left OPEC in May, have been involved in monthly output decisions in recent
years.
