Executive Summary: Oil market outlook
Oil prices have received support from OPEC’s meeting in Algeria last month. The cartel’s members came to an understanding to re-establish a ceiling on oil output. However, oil price gains have been limited because the market is still not convinced OPEC will implement a cap at its next meeting, which is scheduled for 30 November. The fundamentals are also predominantly bearish, further limiting price gains.
An overall production target of 32.50-33.00 million barrels per day (MMb/d) was proposed in Algeria. This is marginally lower than the cartel’s estimated August output of 33.17 MMb/d, based on data from secondary sources used by OPEC in its monthly oil report. OPEC has established a high-level committee to study and recommend production levels for individual members, and its findings will be discussed in the November meeting.