OPEC+ makes modest supply hike as Russia turmoil lifts price

OPEC and its allies agreed another modest revival in supplies for April at a low-key meeting that was overshadowed by the market turmoil unleashed by Russia’s invasion of Ukraine.

OPEC and its allies agreed another modest revival in supplies for April at a low-key meeting that was overshadowed by the market turmoil unleashed by Russia’s invasion of Ukraine.

The 23-nation coalition led by Saudi Arabia ratified an increase of 400,000 barrels a day on Wednesday, continuing the gradual restoration of output halted during the pandemic, according to a statement. 

The modest monthly supply boost -- which many members have been struggling to fully deliver as they grapple with capacity constraints -- paled into insignificance in a market rocked by Moscow’s military aggression and consumers’ counter-measures, which include a release from emergency fuel stockpiles. Russia is the OPEC+ alliance’s second-biggest member.

While the invasion hasn’t prompted Western sanctions on Russian energy exports, there are growing signs that reluctance among traders and shipowners to handle the country’s oil could bring about an embargo in all but name. Russia’s Urals crude was offered for sale at a record discount but found no bidders.

During Wednesday’s OPEC+ meeting, Mexico’s Energy Minister Rocio Nahle briefly raised a question about Russian oil production, but there was no real discussion of the matter, delegates said, asking not to be named because the meeting was private.   

Prior to previous OPEC+ meetings, Riyadh had come under pressure from the U.S. to raise output faster, but consumers are now taking matters into their own hands. The International Energy Agency, which represents major industrialized economies, said on Tuesday that it will deploy 60 million barrels from emergency oil stockpiles around the world.