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A
virtual meeting puts the focus on the pending European Union
deal over the price cap on Russian oil, as well as a Dec. 5
deadline imposed by the bloc for a full embargo on purchases of
Moscow's seaborne crude.
"OPEC+ would rather sit on the bench at this time and assess the
outcome of what happens on Monday," one source with direct
knowledge of the matter told Reuters on Wednesday.
The Organization of the Petroleum Exporting Countries and allies
including Russia, known as OPEC+, also meets as China's COVID-19
lockdowns weigh on demand and prices. Still, oil on Wednesday
gained support from hopes of a Chinese demand recovery.
OPEC+ had been expected to convene in Vienna for only the second
time since the pandemic.
OPEC also made a meeting of its own ministers planned for
Saturday a virtual gathering, and OPEC+ cancelled a meeting of
oil market experts, the Joint Technical Committee, that had been
scheduled for Friday, sources said.
"It looks like a simple decision to roll over on Sunday," an
OPEC+ delegate said. Some delegates who had travelled to Vienna
for technical meetings this week were making plans to return
home ahead of the weekend.
In October, OPEC+ agreed to cut output by 2 million barrels per
day (bpd) equal to 2% of global supply, effective until Dec.
2023. The decision caused a clash with the West as the U.S.
administration called the decision shortsighted.
Top OPEC exporter Saudi Arabia on Nov. 21 said OPEC+ was
sticking with output cuts and could take further measures to
balance the market.
Analysts and some OPEC+ delegates have said a further cut on
Sunday should not be ruled out, although two delegates on
Tuesday put a low probability of this happening.
"Market fundamentals favour another cut, especially given the
uncertainty over China's COVID situation," said Stephen Brennock
of oil broker PVM.
(Reporting by Maha El Dahan; Alex Lawler, Ahmad Ghaddar, Olesya
Astakhova and Rowena Edwards; Editing by Kim Coghill and Elaine
Hardcastle)
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