Opec+ seen sticking to oil rise plan despite EU sanctions

Opec+ seen sticking to oil rise plan despite EU sanctions

Reuters Dubai/London

Opec+ is set to stick this week to its monthly modest oil output increases despite seeing tighter global markets, five Opec+ sources said on Wednesday as the group fast approaches its maximum production capacity.

Oil prices rallied above $124 per barrel this week following new EU sanctions against Russia over its invasion of Ukraine and China’s recovery from the latest Covid-19 lockdown.

The world’s most industrialised countries, known as G7, called again this week on Opec to help ease a global energy crunch that worsened as a result of Western sanctions imposed on Russia.

Opec, which meets on Thursday together with allies such as Russia as part of a group called Opec+, has repeatedly rebuffed calls for faster production increases. Opec+ is widely expected to raise July output targets by 432,000 bpd.

The group’s record output-cutting deal, clinched in 2020 at the height of global lockdowns, expires this September by which time the group will have limited spare capacity to increase production further.

Its lead member Saudi Arabia is producing 10.5mn bpd and has rarely tested sustained production levels above 11mn bpd.

Together with fellow Gulf Opec member, the United Arab Emirates, Opec is estimated to have less than 2mn bpd of