The group’s broader strategic framework has three main pillars. First, maintaining internal discipline

among OPEC+ members, especially amid recent friction, such as that involving Kazakhstan. Second

preparing for potential supply shocks. The market’s muted response to major geopolitical events, like

Iranian missile attacks, demonstrates increased resilience. Third and most importantly, preempting

the long-term challenge of plateauing and eventually peaking global oil demand. For producers

maximizing output before the demand peak becomes crucial. Sitting on five or six million barrels

of spare capacity would be a strategic misstep. The phased unwinding of supply cuts continues.

The initial 2.2 million bpd cut is being reversed by September, reducing spare capacity to around

4.3 million. If the additional 1.6 million bpd cut is also lifted early, spare capacity drops further. A full

reversal could return OPEC+ to its typical 1–2 million bpd buffer, indicating a normalization of market

conditions.

U.S. economic policy presents a paradox

On the one hand, new tariffs may dampen global growth by disrupting trade flows, an unfavorable

outcome in today’s fragile economic climate. On the other, the U.S. just enacted a highly expansionary

fiscal stimulus package, including tax cuts, which is likely to fuel inflationary pressures. This dual

approach raises concerns: rising national debt, protectionist trends, and potential economic

overheating. While Trump’s style is often unpredictable, assuming he always backs down could be

risky. Volatility is likely to persist. With the U.S. midterm elections approaching, Trump may face

mounting pressure from both his MAGA base, some of whom are losing social benefits, and the

business community. If markets falter, we could see another wave of policy responses. But thus

far, Trump has performed against expectations and cleared several hurdles. A scenario with no

recession, limited tariff fallout, no inflation spike, and a Republican midterm victory would defy

many forecasts.

Peak Oil demand on the horizon

If current trends continue, global oil demand could peak around 2029. China is leading this

transformation, thanks to its progress in energy efficiency and its economic shift from heavy

industry toward consumption and services. These developments will gradually reduce the pace of

oil demand growth, diverging from historical norms.