OPEC countries are set to maintain current production levels at a meeting next month, three delegates said, as Gulf states continue to focus on market share and a rally in crude prices mutes calls from other members for supply cuts.
While the June 5 meeting in Vienna is likely to hear demands from some members of the Organization of the Petroleum Exporting Countries for a reduction in the amount of oil pumped, even officials from countries which favour a curb see it as unlikely.
A surprise rally driven by tensions in the Middle East and signs the supply glut will ease pushed Brent crude to a 2015 high of $68.23 a barrel on Tuesday, up from January’s nearly six-year low close to $45. Oil prices more than halved last year after reaching $115 a barrel in June.
“The prices were expected to be below $40 for Brent,” said a delegate from a Gulf OPEC country. “The prices have been better than everyone expected, so OPEC policy will continue most likely.”
Last year’s collapse in oil prices accelerated after OPEC refused to cut its output limit of 30 million barrels per day in favour of defending market share. That shift in policy was driven by top exporter Saudi Arabia, which has raised output to a record high, and supported by Gulf states.