OPEC+ decision leaves market guessing, and oil rangebound

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World Economy News

OPEC Actions,OPEC,Wall Street

The oil cartel's plan has market and geopolitical implications.

For now, OPEC+ is in no hurry to bring many more barrels to the market as demand growth remains modest.

It could be a signal that prices will "remain elevated through the U.S. presidential election," as theCurrent curbs totaling 2.2 million barrels per day will extend through the third quarter and then gradually phase out through September 2025. But those monthly increases "can be paused or reversed subject to market conditions," the group said.

Meanwhile, roughly 3.7 mbd of other standing cuts will be extended through 2025, though the United Arab Emirates baseline production quota rises starting next year.RBC Capital Markets says Saudi Arabia may have done enough to help talks with Washington about a security deal."Relations between Washington and Riyadh have seen a significant recovery from October 2022 lows and today's decision should keep that trend line intact.

 

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