Opec+ to hold in-person meeting next week in Vienna

This will be the first in-person ministerial meeting since March 2020, the group says

Oil prices have been highly volatile due to a strong US dollar and a worsening global economic outlook. Reuters
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The Opec+ super group of oil producers plans to hold its first in-person meeting next week since March 2020 as the group considers cutting oil production to address a recent slump in prices.

The 23-nation group, led by Saudi Arabia and Russia, is scheduled to meet on Wednesday at its headquarters in Vienna, according to a statement from Opec’s secretariat on Saturday.

“The Opec secretariat looks forward to welcoming all ministerial delegations again to Vienna. These upcoming meetings will be the first in-person ministerial meetings since March 2020,” the statement said.

The group has been meeting online on a monthly basis and was not expected to arrange an in-person gathering until at least the end of this year, Bloomberg reported.

Brent crude soared above $125 a barrel following Russia’s invasion of Ukraine in February. Since then, it has dropped to $85 as central banks raise interest rates to fight inflation and economies from the US to China slow.

Brent, the benchmark for two thirds of the world's oil, was trading at $85.14 a barrel at 3:45pm UAE time. West Texas Intermediate, the gauge that tracks US crude, was trading at $79.49 a barrel.

Oil prices have been highly volatile due to a strong US dollar and a worsening global economic outlook.

Most brokerages have said that Opec+ has to make oil cuts between 500,000 barrels per day and 1 million bpd to keep Brent above $90 a barrel.

“To address prevailing oil demand concerns, stop the negative price momentum and set a floor to prices, we think the group has to announce a production cut of at least 0.5 million bpd over the coming days,” UBS analysts Giovanni Staunovo and Wayne Gordon said in a research note last week.

The 13-nation Organisation of Petroleum Exporting Countries entered into a partnership, known as Opec+, with 10 other major producers in 2016, including Russia.

Opec+ underscored its readiness to steady the market with a symbolic reduction at a previous meeting on September 5.

The group agreed in September to cut its October output by 100,000 bpd, reverting to August production levels to support prices, with the slowing global economy posing demand headwinds and a potential Iran nuclear deal bringing more crude to the market.

“The simple tweak shows that we will be attentive, pre-emptive and proactive in terms of supporting the stability and the efficient functioning of the market to the benefit of market participants and the industry,” Saudi Energy Minister Prince Abdulaziz bin Salman told Bloomberg.

Bloomberg contributed to this report

Updated: October 01, 2022, 12:23 PM