OPEC ponders production cuts to boost market prices

The Organization of Petroleum Exporting Countries (OPEC) may be looking at announcing a major output slash to boost oil market prices.

An OPEC+ source told Reuters on Monday that the expanded cartel is considering bigger oil output cuts during its November 30 meeting, which was originally delayed for four days over a production quota dispute between OPEC leaders and African nations.

The unnamed OPEC+ source expected an option for a “collective further reduction” in oil production during the next meeting.

The source’s comments echo similar comments made earlier in November suggesting that additional cuts would be considered.

Last week, analysts increasingly chimed in to predict either an extension of the existing 1 million-barrel-per-day voluntary cuts or additional cuts to support prices which have fallen from highs of close to $100 per barrel in September to barely holding down $80 currently.

Late last week, reports emerged that OPEC+ was making progress in talks with its African producers over their oil output quotas next year after Angola and Nigeria requested a higher production ceiling next year. Both countries took a cut in their quotas at the June 2023 meeting of OPEC+ as they had consistently failed to pump to their quotas.