Opec+ agreed to keep oil production levels unchanged and approved a mechanism to determine members' maximum oil production capacity during a series of meetings of the exporters' group on Sunday.
This month, the group, which pumps about half the world's oil, paused output increases for the first quarter of 2026 due to seasonal weak demand. It has brought 2.9 million barrels per day into the market since April this year.
Opec+, made up of the Organisation of Petroleum Exporting Countries and its allies such as Russia, said in a statement on Sunday it was reaffirming the level of overall crude oil production for Opec and non-Opec countries as agreed to earlier until December 31, 2026.
It also said it had approved "a mechanism to assess participating countries’ maximum sustainable production capacity to be used as reference for the 2027 production baselines".
The group, which also includes Saudi Arabia, Iraq, the UAE, Kazakhstan, Algeria and Oman, has been phasing out voluntary production cuts.
The group is unwinding 1.65 million bpd of voluntary cuts announced in April 2023. Opec+ approved adding about 137,000 bpd for each of October, November and December.
There are also cuts of 2 million bpd announced by most of the 22 members of the group until December 2026.
In its statement following the meeting, Opec urged all the countries in its alliance to adhere to conformity in production quotas.
The group will hold its next meeting on January 4, 2026.
Oil markets have remained volatile this year due to geopolitical tension, US President Donald Trump's tariffs and production cuts by Opec+.
The US Federal Reserve's decision to cut interest rates, as well as American sanctions on Russian oil companies such as Lukoil and Rosneft, have also affected oil prices.
This week, oil prices traded lower as the US increased efforts to end the Ukraine war and to reintegrate Russia into the global economy by lifting sanctions.
Brent retreated 0.78 per cent to settle at $62.38 per barrel. West Texas Intermediate shed 0.17 per cent to $58.55 a barrel.
The Ukraine war, which began more than three years ago, has been bullish for oil prices due to concern over lower supplies of Russian crude as western sanctions curtail Moscow's oil revenue.
If sanctions on Russia end, Russian oil is expected to flow into global markets, which is expected to bring down prices. However, a continuing war would support prices.
Markets are also grappling with oversupply concerns as Opec+ boosts output.
There is expected to be a potential oversupply of up to 2 million bpd next year, traders told the recent Adipec energy conference in Abu Dhabi.
Sanctions on Russian oil by the US and the EU are preventing a glut from forming in global markets, Torbjorn Tornqvist, chief executive of commodities trader Gunvor Group, said this month.
However, UAE Minister of Energy and Infrastructure Suhail Al Mazrouei does not expect oversupply in the market.
There is a strong demand for oil due to the data centre boom spurred by AI use, Mr Al Mazrouei said at Adipec.
“I am not going to talk about an oversupply scenario, I can't see that ... what we're seeing is more demand,” Mr Al Mazrouei said.
“Countries like the UAE and others are investing enough, because we know the demand is there.”
The UAE's production capacity of 4.85 million bpd is close to its target of 5 million bpd, which it hopes to reach by 2027.
Producers such as the UAE want to add more supply to the market, given recent investments in capacity, which have idled due to Opec+ production curbs since 2023.
