Dubai: OPEC and its allies delayed preliminary talks between ministers by a day to allow more time for a compromise before a critical meeting on Thursday, according to two delegates.
The coalition, led by Saudi Arabia and Russia, is considering whether to continue reviving more crude supplies as global demand bounces back from the coronavirus pandemic.
Moscow is weighing a proposal to hike output, but Riyadh has signaled it prefers a gradual approach. It's not the first time the two leaders have gone into the meeting with different stances - and they tend to hash out a compromise. One delegate predicted the same would happen this time.
With oil prices have climbed to the highest level in around 2-1/2 years, analysts widely expect the group to tap some of the vast capacity it shuttered last year. The average expectation is for an increase of 550,000 barrels a day - roughly 10% of of the volume that remains idle.
Brent crude rose 0.4% to $75.07 a barrel by 1:07 p.m. in Singapore. While its dropped this week amid growing concern about a more contagious variant of the virus, it's still up 45% this year.
"The choice OPEC+ now faces is whether to consolidate those gains and allow prices to stabilize, or to let prices rise further, attracting mounting ire from consumers," analysts at Standard Chartered Plc, including Sudakshina Unnikrishnan, said in a note Tuesday.
The 23-nation alliance had been due to convene its advisory body, the Joint Ministerial Monitoring Committee, on Wednesday. That session will now take place on Thursday, the same day as the main policy meeting.
Delegates said it was to allow more time for talks. According to an official letter, Russia's Deputy Prime Minister Alexander Novak sought the delay because of "presidential commitments."
Russia, which faces less budgetary pressure to sustain high prices than many of its Middle Eastern allies, wants OPEC+ to boost production, according to people familiar with its oil policy. Riyadh's position isn't currently aligned with Moscow, delegates said.
In recent months, Saudi Energy Minister Prince Abdulaziz bin Salman has urged the Organization of Petroleum Exporting Countries and its partners to adopt a cautious approach in resuming output. He recently argued that this is "paying off."
OPEC+ was forced to postpone events as recently as December, when a similar split between Riyadh and Moscow caused the group to delay talks by two days. It ultimately found a compromise, agreeing on a modest production increase.