OPEC+ Faces Supply Pressures Amid Rising Output

OPEC+ faces limited capacity to increase oil production due to rising supplies from the U.S., Brazil, and Guyana, which could outpace demand. Spencer Dale, BP's Chief Economist, indicated that a return to higher production levels may destabilize the market as total supply could grow faster than demand. Currently, OPEC+ has kept approximately 5.8 million barrels per day off the market to uphold prices, but a shift to surplus is anticipated in the coming quarter if production resumes as planned. The ongoing weak economic performance in China has further complicated the outlook for oil prices, leaving market participants uncertain about OPEC+ adjustments. Additionally, geopolitical tensions in the Middle East and supply disruptions will also play significant roles in determining future oil prices. Analysts suggest that without a revival in demand, OPEC+ may need to delay production increases to avoid oversupply scenarios.