OPEC+ agrees on output boost from October

London: OPEC+ agreed to accelerate the return of another chunk of oil that it’s been withholding from the market, as the group sticks with a strategy of prioritising market share over prices.

In a virtual monthly meeting that lasted just 11 minutes, key alliance members approved returning 137,000 barrels a day from October. It’s the first sliver of a bigger 1.65 million barrels a day tranche of supply that was meant to be held back until the end of next year, suggesting cautious optimism about the market.

The Organization of the Petroleum Exporting Countries and its partners stunned oil markets in recent months by reviving 2.2 million barrels of halted production a year ahead of schedule in a bid to reclaim market share, and despite widespread expectations of an approaching glut. That restoration has only just been completed and it didn’t cause prices to plunge or a buildup of inventories in the West, where the world’s key oil-price benchmarks are located.

OPEC+ said in a statement it will return all or part of 1.65 million a day, without giving a period or increments, depending on market conditions. Delegates said the supply will be added in monthly stages until September next year. The group’s next meeting will be October 5.

Crude prices have fallen 12% this year, pressured by increased output from OPEC+ countries and elsewhere, and as US President Donald Trump’s trade war weighs on demand. Yet the market has overall proven surprisingly resilient to the alliance’s strategy shift, giving Saudi Arabia and its allies added confidence to return even more barrels.