Opec+ keeps output policy unchanged: Update 2

Updates with details on today's meeting

The Opec+ group has agreed to keep its latest crude production policy unchanged after meeting today by teleconference.

The Joint Ministerial Monitoring Committee (JMMC), which monitors compliance, today recommended sticking with an Opec+ plan to gradually increase production from next month. Remaining Opec+ members were contacted to give their consent to the decision, in a move that effectively saw the JMMC meeting morph into a full-blown Opec+ ministerial meeting.

The group decided against holding a full ministerial meeting tomorrow as originally planned. The next Opec+ meeting will now take place on 1 June.

The Opec+ group decided earlier this month to gradually raise its collective output ceiling in May-July, and agreed to track market developments vigilantly with the option to reverse course if necessary.

During today's ministerial meeting, members highlighted concerns about rising Covid-19 cases in a number of countries. The group's Joint Technical Committee (JTC), which monitors market conditions, raised a similar issue following a severe surge in coronavirus cases in India alongside new waves of the virus and resulting lockdowns in Europe. But the committee agreed that the market could still absorb the planned increase in Opec+ output, a delegate said.

"There are positive signals regarding the global economy and prospects for our industry," Opec secretary-general Mohammed Barkindo said following yesterday's JTC meeting. But he emphasised that many factors require continued monitoring.

At the last ministerial meeting, the group agreed to increase quotas by a combined 350,000 b/d next month, another 350,000 b/d in June and 441,000 b/d in July. Saudi Arabia plans to unwind its additional, voluntary 1mn b/d output cut over the same period, by 250,000 b/d next month, 350,000 b/d in June and 400,000 b/d in July.

By Rowena Edwards, Ruxandra Iordache and Nader Itayim