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The production policy of the OPEC + cartel will be the main factor influencing oil prices in the coming months, according to Vitol Group.
Iranian barrels are unlikely to return to world markets this year and U.S. shale producers are not investing enough to rapidly ramp up production, the world’s largest independent oil trader has said.
“Price control is largely in the hands of OPEC +,” Mike Muller, Asia manager at Vitol, told a webinar hosted by Dubai-based consultancy Gulf Intelligence on Sunday. In the United States, “the number of rigs is just not there for production to catch up with a catch-up that would be necessary if you needed additional oil.”
The Organization of the Petroleum Exporting Countries and its partners – a group of 23 countries led by Saudi Arabia and Russia – are meeting on Monday. With Brent crude topping $ 80 a barrel last week for the first time since 2018, some traders have called on OPEC + to announce faster-than-expected production increases.
The group is gradually easing the cuts that began as the coronavirus pandemic ravaged energy markets last year. He previously reported that he would increase daily production by 400,000 barrels each month until around mid-2022.
A shortage of natural gas in Europe has exacerbated the tightening of the oil market, forcing companies to turn to crude for power generation.
Some OPEC + members are giving the impression that they are not worried that oil above $ 80 will dampen demand, Muller said.
They “want to make a good chunk of the money before the competition kicks in” from Iran or the United States, he said.
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