The recommendation from the cartel’s joint ministerial monitoring committee will be discussed by ministers later on Wednesday before they take a final policy decision, the delegates said, asking not to be named as the information is private.
If the full meeting of the Organization of the Petroleum Exporting Countries and its allies ratifies the proposal, it would have less of an impact on global supply than the headline figure suggests, as several countries are already pumping well below their quotas. . This means that they would already be in compliance with their new limits without having to reduce their production.
A reduction of 2 million barrels per day of the group’s production target, shared on a pro rata basis, would only require eight countries to reduce actual production and would result in an actual reduction of only 880,000 barrels per day, according to calculations. from Bloomberg based on September production figures.
It would still be OPEC+’s biggest production cut since 2020, a move that risks adding another shock to a global economy already battling inflation driven by high energy costs.
Oil prices rose 0.6% in London to $92.37 a barrel at 2:21 p.m.
The move would also irritate the United States — and potentially trigger a response from Washington. President Joe Biden visited Saudi Arabia earlier this year seeking higher production and lower pump prices for Americans ahead of the midterm elections in November.
Earlier Wednesday, US officials phoned their Gulf counterparts to try to push back on the decision to cut production, according to people familiar with the matter.