Opec+ signals caution on oil production

Eight members sign off on small increase

- STANLEY REED

People walk past a barrel of oil bearing the logo of the Organization of the Petroleum Exporting Countries at a conference last November.

(REUTERS)

A group of eight countries belonging to the oil cartel known as Opec+ said Sunday that it would increase oil production by 137,000 barrels a day beginning in December but signalled caution about its next steps in the face of concerns about oversupply.

The group, in a surprise, said that it would "pause" adding oil for the first three months of next year and that it would closely monitor market conditions and maintain "full flexibility" in deciding whether to continue pausing production increases or even resume cuts.

In a news release, the group attributed the temporary halt to "seasonality." Indeed, demand for crude oil tends to drop in the first quarter as refineries reduce runs. "They don't want to add barrels in a seasonally weak market," said Amrita Sen, the director of market intelligence at Energy Aspects, a research firm.