The Organization of the Petroleum Exporting Countries (OPEC) announced in a statement on Wednesday that the "OPEC+" alliance has postponed a ministerial meeting that was expected to discuss oil production cuts to November 30 instead of the 26th of the same month, a surprising development that led to further declines in crude prices. A source in "OPEC+" told Reuters that the postponement might provide more time for countries to discuss compliance with current and potential future production cuts.
UBS analyst Giovanni Staunovo pointed out that "ambiguity is not good for financial markets at all, as markets will now have to wait longer for a clear picture of what OPEC+ will do next year." He added, "The postponement of the meeting also shows that there is a difference in perspectives among the participants in the group." The meeting was initially expected to take place on Sunday at OPEC's headquarters in Vienna. The organization's statement did not mention whether the meeting would be held online or in person on November 30, but three delegates indicated that it is expected to be held in person in Vienna.
Will there be additional cuts?
Many analysts expect that "OPEC+" is likely to extend oil supply cuts or even increase them next year. Some, including Halima Croft, an analyst at RBC Capital, suggest that Saudi Arabia may request other members to share the burden. Croft stated this week, "We see some room for the group to increase cuts, but we expect Saudi Arabia to seek some oil from other members to share the adjustment burden." Bloomberg reported that delegates said the meeting might be postponed for an indefinite period, noting that Saudi Arabia has expressed dissatisfaction with the production figures of other members.
