The increase in OPEC’s oil output in December has again undershot the rise planned under a deal with allies, a Reuters survey found, highlighting capacity constraints that are limiting supply as global demand recovers from the pandemic.
OPEC and its allies boosted crude oil production by 500,000 bpd in November, with 80% of the increase attributed to five members – Saudi Arabia, Russia, Iraq, Kazakhstan and Nigeria – according to the latest S&P Global Platts survey.
Oil prices climbed on Friday after the producer group OPEC+ said it could review its production hike policy at short notice if oil demand collapsed due to a rising number of lockdowns, while Brent was on course for a sixth week of declines.
OPEC and the oil group's allies hold a key output meeting on Thursday facing new challenges as the Omicron coronavirus variant has roiled markets and other US-led nations decided to tap their strategic reserves.
Oil prices rose towards $81 a barrel on Tuesday after a move by the United States and other consumer nations to release tens of millions of barrels of oil from reserves to try to cool the market fell short of some expectations.
OPEC is seeing signs of an oil supply surplus building from next month so its members and allies will have to be "very, very cautious" when they review output policy at regular monthly meetings, the group's secretary general said on Tuesday.
OPEC cut its world oil demand forecast for the last quarter of 2021 as high energy prices curb the recovery from COVID-19, delaying the timeline for a return to pre-pandemic levels of oil use until later in 2022.