The OPEC+ alliance of oil-producing nations is set to maintain its current production policy, according to sources familiar with the matter who spoke to Reuters. This decision comes despite escalating geopolitical friction between two key members, Saudi Arabia and the United Arab Emirates, primarily centered on the ongoing conflict in Yemen.
Geopolitical Strains Within the Alliance
Sources indicated that the group, led by Saudi Arabia and Russia, will not alter its course on oil output. This stability in policy is notable given the reported tensions. The discord stems from differing strategic approaches to the war in Yemen, a long-running conflict that has been a central focus of Saudi foreign policy.
The UAE, while historically part of the Saudi-led coalition in Yemen, has pursued a more independent path in recent years, focusing on backing different local factions. This divergence in strategy has created a rare public rift between the two Gulf powerhouses, who are typically close allies. However, within the context of OPEC+, the imperative of market stability appears to be taking precedence over these bilateral disputes.
Market Stability Trumps Political Discord
The reported decision underscores the group's current priority: avoiding sudden shocks to the global oil market. OPEC+ has wielded significant influence over crude prices through coordinated production cuts and increases since its formation. Any sign of internal discord, especially between core Middle Eastern members, can introduce volatility.
By choosing to hold the line on existing agreements, the alliance signals a desire to project unity and predictability to energy traders and consuming nations. The sources did not specify when the next formal OPEC+ meeting would take place, but the consensus is that the status quo will be preserved for the foreseeable future.
Implications for Global Energy Flows
For global markets, including major importers, a steady OPEC+ policy provides a degree of short-term certainty in supply. Canada, as a major oil producer and exporter, monitors these decisions closely as they influence global benchmark prices and market sentiment for Canadian crude.
While the geopolitical undercurrents between Riyadh and Abu Dhabi are a significant development, the collective economic interest of OPEC+ members in managing the market seems, for now, to be the stronger force. Observers will be watching closely to see if these tensions impact future negotiations or the group's cohesion when more difficult production decisions arise.
