Opec+ sticks to planned output rises despite oil price rally, sources say

Opec+ agreed on Wednesday to stick to moderate rises in its oil output, two sources from the group said, despite pressure from top consumers for a bigger increase in supply after crude prices hit seven-year highs.

The Organisation of the Petroleum Exporting Countries and allies led by Russia, a group known as Opec+ which produces more than 40 per cent of global oil supply, has faced calls from the United States, India and others to pump more oil as economies recover from the pandemic.

But Opec+ has stuck to its target of monthly increases of 400,000 barrels per day (bpd) and blamed surging prices on the failure of consuming nations to ensure adequate investment in fossil fuels as they shift to greener energy.

Several Opec+ sources also said prices had been pushed up by Russia-US tensions. Washington has accused Moscow of planning to invade Ukraine, which Russia denies.

Oil output increases are complicated by the fact that several Opec members have strugglled to meet even current monthly targets and lack spare capacity to boost production any further.

Brent crude was trading above $90 a barrel on Wednesday and touched a seven-year high of $91.70 last week, amid tensions in Europe and the Middle East.

A report prepared for the meeting by Opec+ experts and seen by Reuters kept the 2022 forecast for world oil demand growth unchanged at 4.2 million bpd, and said demand would hit pre-pandemic levels in the second half of the year.

Oil demand was slightly above 100 million bpd in 2019 but was hammered by the pandemic in 2020. — Reuters