Vienna | OPEC +, back in Vienna on Wednesday for the first time since March 2020, wants to mark the occasion: on the menu, a significant drop in oil production quotas to support a shaky market.
• Read also: OPEC+ cuts oil production amid recession fears
The thirteen members of the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia, and their ten partners led by Russia meet at the headquarters of the cartel from 2:00 p.m. (12:00 GMT), after long months of videoconferencing.
A flesh-and-blood meeting decided at the last minute, enough to fuel rumors of drastic cuts in the face of fears of recession.
When the delegations arrived in the Austrian capital on Tuesday, the energy ministers did not want to comment on these rumors, whether it was the Saudi prince Abdel Aziz bin Salman or his Emirati counterpart, Souhail bin Mohammed Al – Mazrouei.
“Let’s wait, let’s not make hasty conclusions: there is a process (to follow), we must first listen to the technical team, watch the market and make a decision based on it,” the latter told reporters urging him. questions in the hotel lobby.
” Ahead “
For the markets, the outcome of the meeting is no longer in doubt.
“They now expect a significant reduction in production targets, more than one million barrels per day,” said Craig Erlam, at Oanda.
According to the Bloomberg agency, participants in the meeting are even discussing a reduction of around two million barrels per day from November, twice as much as most initial forecasts.
If necessary, this would be the largest drop since the historic cuts of nearly 10 million decided in the spring of 2020, ahead of the collapse in demand linked to the Covid-19 pandemic.
A prospect that made the price of black gold jump at the start of the week.
OPEC+ members “would like to be a step ahead of a possible recession through proactive measures,” says Bjarne Schieldrop of Seb. “Which would allow them to avoid a possible accumulation of inventories and therefore low oil prices”.
Already in September, the group had slightly lowered its target (by 100,000 barrels) and said it was ready to do more.
Since then, the two global crude benchmarks have lost ground, returning to their January levels, a far cry from the highs recorded in March at the start of the war in Ukraine, at $139.13 for Brent and $130.50 for WTI. .
The United States in sight
In reality, the alliance is struggling to return to pre-pandemic levels and is well below the posted quotas.
“The gap between actual production and target production has widened in recent months,” said Edoardo Campanella of UniCredit.
In August, OPEC+ thus missed its target of more than 3.5 million barrels per day, due to a lack of sufficient capacity.
A drastic cut in quotas may therefore not make much difference in practice.
But in any case, it “will not be well received by the White House in the run-up to the midterm elections next month”, warns Tamas Varga, at PV Energy.
US President Joe Biden has been struggling for months trying to stem soaring prices, even going so far as to visit Riyadh in July during a highly controversial visit.
Such a decision by OPEC+ would also suit Russia, “and could therefore be perceived as a further escalation of geopolitical tensions”, warns Ipek Ozkardeskaya, analyst at Swissquote.
In this context, experts evoke a possible reduction spread over time, which would be much less “provocative” for the United States.