(Bloomberg) — OPEC+ is unlikely to increase output in the coming months because of limited spare capacity, according to the International Energy Agency.
Furthermore, the “largely symbolic” 100,000 barrel-a-day hike promised for September may actually turn into a cut as Russian production declines, the IEA said.
“Comparatively low levels of operational spare production capacity, held mainly by Saudi Arabia and the United Arab Emirates, may thus all but rule out substantial further OPEC+ output increases in the coming months,” the IEA said in its monthly report on Thursday.
The outlook from the Paris-based organization that advises major developed economies on energy policy suggests the burden of satisfying global oil demand growth in the latter part of the year will fall on countries outside the Organization of Petroleum Exporting Countries and its allies.
Non-OPEC+ supply is projected to rise by 1.7 million barrels a day this year and 1.9 million next year, according to the IEA. That’s a significant acceleration compared with last year, but still falls short of 2.1 million barrels a day of demand growth expected in 2022 and 2023.