OPEC+ transitions to virtual meeting amid market anticipation of ongoing production cuts

Opec+ Cancels In-Person Meeting, Opting for Virtual Conference

In a surprising move, Opec+ has decided to cancel its formal meeting in Vienna next week and instead hold a video conference to discuss production policy for the second half of the year. This decision comes as a sign that there may already be broad agreement among members to rollover existing oil production cuts.

The 22 members of Opec+, led by Saudi Arabia and Russia, will now convene online on June 2, with concerns over the health of 88-year-old King Salman of Saudi Arabia potentially playing a role in the shift from an in-person meeting to a virtual one. Saudi energy minister Abdulaziz bin Salman, who chairs Opec, is the king’s son.

This change marks only the third time the group has opted for a virtual meeting since the start of the Covid pandemic. Analysts believe that discussions this time around are expected to be smooth, with most anticipating Opec’s members to extend the voluntary cut of 2.2 million barrels per day agreed upon last November.

The decision to rollover production cuts comes as Opec+ aims to stabilize prices amidst higher US production and an uncertain economic outlook in China. With the price of benchmark Brent crude hovering near three-month lows, many believe that extending the current production cuts is the most likely outcome of the upcoming meeting.

Overall, the shift to a virtual conference and the expected rollover of production cuts have sparked interest and speculation among industry experts and stakeholders.