Today, oil prices are hovering around $75 a barrel, a comfortable figure for non-OPEC+ countries, though OPEC+ members reluctantly accept this level. The current month as well as the coming six months should be relatively easy for oil producers, as this period marks the peak season with high demand because winter is coming. Perhaps it is time for OPEC+ to think about future demand and figure out how to address the challenges posed by new oil producers entering the market. For instance, they might explore long-term crude oil deals with Russian customers. The U.S. oil producers are becoming increasingly aggressive, as they are operating without the constraints of political considerations and focused solely on shareholder interests. While OPEC+ has decided to postpone any increase in oil production for another year, it is likely to prioritize Russia in terms of quota adjustments to honor its commitment to the agreed reduction directives. One issue that must be occupying OPEC+ is the outcome of the US presidential election and its impact on oil markets. The Republican candidate is likely to push for increased oil exploration and for the U.S. to become hydrocarbon-free from imports. This could lead other oil producers to struggle to find new market outlets for crude oil in the East of Suez. Perhaps taking proactive steps is the best policy for OPEC+ at this time of year. It is important to consider the future challenges facing the oil industry. With oil prices at $75 or above, OPEC+ is in a comfortable position for the coming months.

By Kamel Al-Harami
Independent Oil Analyst

Email: [email protected]