(Bloomberg) OPEC+ has agreed to pump the market with additional 400,000 barrels a day of crude for March, despite some members struggling to meet monthly hikes.
The expected move by OPEC+ comes when oil prices hover around $90 a barrel amid issues of underinvestment and militia unrest facing some OPEC+ members.
The output plan by OPEC+ comes amid pressure by top consumers, including the US and India, which have called for more oil to address rising inflation and support economic recovery.
RBC Capital Markets chief commodities strategist Helima Croft says that if oil prices continue to rise, it could prompt Saudi Arabia to take the mantle of a regulator role to ramp up output.
Stephen Brennock, an oil analyst at PVM, says the expected supply hike is likely to feed the price increases since it will be seen as a reduction of OPEC+ spare capacity instead of a rise in global oil inventories.
OPEC raised production by about 50,000 bpd in January, with the additions wiped out by a 140,000-bpd fall in Libya’s output.
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