OPEC+ keeps December oil output targets steady ahead of tougher call for 2027

LONDON/MOSCOW, Nov 1 : OPEC+ oil-producing countries kept December production targets steady on Sunday, confirming expectations that more policy adjustments will not occur until next year, as the group continues to struggle with export disruptions from the Iran war.

Seven core OPEC+ members — Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman — made the decision in an online meeting on Sunday, OPEC said in a statement. While Gulf members have been boosting exports that have been disrupted for months by the conflict, most are still pumping well below their targets.

OPEC+ comprises the Organization of the Petroleum Exporting Countries and allies including Russia. Only the seven members — plus the United Arab Emirates until it quit OPEC in May — have been involved in monthly output decisions in recent years. All members of the 21-country group are due to meet on November 29, when analysts expect it will decide 2027 quotas.

"Today's decision was the easy one," said Jorge Leon, an analyst at Rystad. "The much more important test comes at the November 29 ministerial meeting, when OPEC+ will decide its 2027 production framework."

Oil prices jumped more than 2 per cent on Friday, with Brent crude settling at almost $118 a barrel, the highest since April, as traders braced for a potential escalation in the Iran war after the US midterm elections.

The International Energy Agency and other forecasters have warned of excess supply in 2027 should Gulf flows return to normal.

"OPEC+ faces an extremely difficult call for 2027," Leon added. "The group has to plan around huge uncertainty over the US-Iran war, the pace of recovery through the Strait of Hormuz, and the size of the surplus that could emerge once disrupted barrels return."

OIL CAPACITY REVIEW IN FOCUS

The seven members have been boosting output targets for much of 2026 and in September completed the phased rollback of a 1.65 million-barrel-per-day supply cut first agreed in 2023. At earlier meetings, they kept the targets steady for October and November.

OPEC+ still has one more layer of production cuts of about 2 million bpd covering most members through the end of 2026.

The group needs to complete a review of members' production capacity during the fourth quarter before setting the 2027 baselines that will determine future quotas and shape plans to unwind those cuts, sources have said.

The Iran war has disrupted projects to expand capacity across the Middle East, throwing estimates of future production potential into uncertainty, Reuters reported in October. As a result, the review is now expected to be completed by mid-November.

(Writing by Alex Lawler; Editing by Joe Bavier and Alex Richardson)