There have been reports suggesting they might accelerate output increases as early as June again, but we are also hearing that they don’t want to worsen market conditions. Many members are choosing to wait and observe trends before committing to any further change. Developments with US tariffs will likely influence the group’s next move. For now, OPEC+ sees this as a rare window to regain lost market share with its planned volume increases for April and May.
How serious is discord within OPEC+ on compliance?
Kazakhstan and Iraq have been persistent overproducers. This noncompliance has led to frustration among countries that are adhering to the agreement. Another concern is the possibility of stricter sanctions on Iran, which could result in a significant loss of supply, potentially around 500, 000 barrels per day, affecting future planning. Clarity on OPEC+ strategy is expected after the next meeting of voluntary production cutters, scheduled for May 5th.
Why has Kazakhstan had such compliance challenges?
Most of its production is controlled by foreign companies, which the government has little leverage over. The state oil firm could cut output, but it represents only a small share of total national production. Still, while Kazakhstan claims to support OPEC+ market stability goals, it also prioritizes national interests over quota compliance and sources tell us that it sees little urgency to change course under the current price scenario.
Likelihood of Europe switching back to take more Russian energy?
There’s a divergence in energy policy with the US and OPEC. The UK and EU are advocating for scaling up domestic clean energy as the path to long-term energy security and a roadmap is expected soon, outlining the EU’s plan to completely phase out Russian fossil fuels by 2027, including LNG imports.