OPEC+ Freezes Output Policy Amid Ongoing Disruptions

OPEC+, a group of major oil-producing nations, maintained its unchanged output policy for October as it seeks to agree on new quotas before deciding on further production adjustments. The grouping, which includes Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman, met recently amid ongoing disruptions in Iran's oil exports through the Strait of Hormuz.

The OPEC+ nations still produce below their targets due to the war, limiting their influence over prices and market share. According to Jorge Leon of Rystad Energy, 'OPEC currently has very limited power over the physical oil market.' He notes that despite agreed production increases, the group cannot guarantee that barrels will be produced or reach the market.

OPEC+ still has additional production cuts in place until the end of 2026. Before deciding how to unwind these cuts and return production to the market, it needs to review members' oil production capacity to set 2027 output baselines. This debate is expected to happen later this year, which may lead to a pause in output increases for the fourth quarter.