OPEC+ countries meeting on Wednesday decided to maintain their plans for a gradual increase in oil production. The oil ministers agreed to increase collective production by 400,000 barrels per day in October, keeping with their earlier commitments made in April 2020 and July 2021. The “high conformity” of member nations to these commitments was commended, with the attendees agreeing to reconvene next month. “Market fundamentals have strengthened and Organization for Economic Cooperation and Development (OECD) stocks continue to fall as recovery accelerates” amid the COVID-19 pandemic, read a statement by the group. OPEC+ and its allies are likely to carry on their plan to gradually return the massive amount of crude production and keep raising production by 400,000 barrels per day every month for the rest of the year. Crude futures traded higher Wednesday as the market quickly moved to discount the net negative effect on supply and demand balances for Sep-21 from Hurricane Ida and instead focused ahead on the monthly OPEC+ meeting. The market widely expects OPEC+ to ratify its plan of bringing back 400,000 bpd of crude supply also for October, which is what’s on the table Wednesday. Ministers also received the forecast for supply-demand from OPEC+’ own technical committee Tuesday, which predicts a deficit in the oil market of 825,000 bpd through year-end if OPEC+ follows its plan. Markets seem to largely agree with OPEC+ on the expected supply shortage and the stock draws that will be caused are being priced in through the forward curve. What is not so certain, Rystad Energy believes, is whether demand will be able to grow as quickly as OPEC+ and the market predicts, given the risk of new lockdowns to fight the unresolved COVID-mutant spread. “We may be witnessing a classical ‘buy the rumor, sell the fact’ pattern in trading Wednesday, as prices are bid up in case OPEC+ were to deliver a ‘surprise move’ and chooses to hold back its scheduled supply increase,” said Rystad Energy’s Head of Oil Markets Bjornar Tonhaugen. “A theoretical surprise decision to hold off from increasing supply in October would potentially support prices further, but a more likely ‘stick to the plan’ decision is likely to keep them from rising,” added Tonhaugen. — Agencies