Early this week OPEC+ decided to continue its existing agreement of adding 400,000 barrels per day of oil to market, therefore driving U.S. crude prices up.
The OPEC+ group, which consists of the original Organization of the Petroleum Exporting Countries and Russia, has a previously agreed upon a plan to return to pre-COVID output levels. In July, after a series of meetings which initially failed to reach an agreement or schedule, the group decided to boost output by 400,000 bpd a month until at least April 2022.
Pressure to increase production further is mounting internationally as demand bounces back and concerns grow about a cold winter ahead. Domestically, President Biden has also asked the cartel to boost production, a move Council CEO Leslie Beyer called “entirely counterproductive” to his Administration’s stated environmental and economic goals.
However, given the Delta COVID-19 variant prompting new lockdowns in China and other key fuel consumers in Asia, a continued measured approach toward output is what OPEC+ is looking for.
This week’s decision to stay the course sent oil prices to their highest in three years with West Texas Intermediate closing at $77.62 a barrel and Brent ending at $81.26, according to the Wall Street Journal.
For more information, contact SVP Government Affairs Tim Tarpley.
Maria Suarez, Director Government Affairs, writes about industry-specific policies for the Energy Workforce & Technology Council. Click here to subscribe to the Council’s newsletter, which highlights sector-specific issues, best practices, Council activities and more.
