Ahead of the meeting, OPEC Secretary-General Mohammed Barkindo stressed the need “to remain very cautious” as a result of ongoing uncertainties and fragility caused by the coronavirus pandemic.
Similarly, Saudi Arabia has previously encouraged allied partners to remain “extremely cautious” on production policy, warning the group against complacency as it seeks to ensure a full oil market recovery.
Non-OPEC leader Russia, meanwhile, has sought for the group to push ahead with a supply increase.
Two unnamed OPEC+ sources told Reuters that an increase in oil production at Thursday’s meeting would not exceed 0.5 million barrels. CNBC was not able to independently verify these sources.
“I think if you look into the second half of the year, with demand potentially increasing by 4 to 5 million barrels as we get into 3Q and 4Q, I think this is really when the tightness in the oil market is going to really reappear again,” Neil Beveridge, a senior oil and gas analyst at Bernstein, told CNBC’s “Capital Connection” on Thursday.
“At the moment it feels too early to raise production but as we go into the second half, there’s a lot of pent-up demand and OPEC is going to need to put oil in the market if they are going to control pricing.”
U.S.-Saudi call
U.S. Energy Secretary Jennifer Granholm said via Twitter on Thursday that she spoke with Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman to reaffirm “the importance of international cooperation to ensure affordable and reliable sources of energy for consumers.”
It was thought to be the first call to Riyadh from a U.S. official ahead of an OPEC meeting since President Joe Biden took office.
OPEC+ initially agreed to cut oil production by a record of 9.7 million barrels per day last year, before easing cuts to 7.7 million and eventually 7.2 million from January.
Saudi Arabia has since taken on cuts of 1 million from the beginning of February through March, although these are due to expire unless further measures are announced on April 1.
