With oil prices highly volatile the OPEC+ Group consisting of OPEC, Russia and several other allies, will be meeting this Thursday, March 31, to define production quotas.
The meeting comes as the IEA has been pressing the alliance to increase production, due to tight markets and high prices. The producers have since the end of last summer been increasing their production quotas by 400,000 barrels per day each month. Nonetheless they have in reality not been increasing production by that amount, meaning that production is lower than expected.
Key players in the meeting will be Russia, whose exports fell 26% last week under the pressure of sanctions, Saudi Arabia and United Arab Emirates. The latter two are the only OPEC countries with spare capacity to ramp up production if desired.
“I very much hope the meeting on March 31 will come up with some good messages which would help to relieve the strain in the oil markets,” said executive director of the IEA, Fatih Birol. “Many of the key oil producing countries have in the past again and again proven that they were responsible players in the energy markets when it comes to such difficulties and I very much hope that once again they will be on the right side here.”
Nonetheless markets are assuming that Saudi Arabia and the UEA will not raise production beyond the already established parameters, according to industry portal OilPrice.com.