Despite crude oil prices trending higher so far this week, they are unlikely to have risen enough to encourage OPEC+ to reinstate its delayed plans to boost output in 2025. The exporter group, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, still has little room to maneuver on oil policy when it meets early next month.

OPEC+ has already delayed a plan to gradually lift production as world demand for crude fell short of what the group and other analysts had been forecasting earlier in 2024. It may push back output increases again when it meets on Dec. 1 due to weak global oil demand, according to three OPEC+ sources familiar with the discussions. Ministers last shelved the increase for a month when they met virtually on Nov. 3.

OPEC+ had planned to slowly roll back production cuts with small increases over many months in 2024 and 2025. But a slowdown in Chinese and global demand, and rising output outside the group, have put a dampener on that plan. This has left OPEC+ maintaining output cuts for longer than it had thought. The group has cut output by 5.86 million barrels per day, or about 5.7% of global demand, in a series of steps agreed since 2022 to support the market.

OPEC+ may also be wary of signs that China’s crude imports may have risen in November to the highest in three months, as the gain is more likely to have been driven by weakening oil prices at the time when cargoes arriving in November were arranged over August and September.

Imports may reach around 11.4 million bpd this month, the most since August and the third-highest month so far in 2024, according to vessel-tracking and port data compiled by commodity analysts Kpler and LSEG Oil Research. China’s refiners have in the past shown that they will buy more crude than they need when they deem prices to be low, and cut back on imports when they view prices as having risen too high, or gained too rapidly.

Source: Reuters