OPEC sees the oil market as well supplied and is wary of creating a glut next year, the group’s secretary-general said on Thursday, suggesting producers are in no rush to expand a June agreement that raises output.
Oil prices have rallied this year on expectations that U.S. sanctions on Iran will strain supplies by lowering shipments from OPEC’s third-largest oil producer. Brent crude LCOc1 last week reached $86.74, the highest since 2014.
OPEC Secretary-General Mohammad Barkindo, speaking at the Oil & Money conference in London, said there were many non-fundamental factors influencing the oil market that were beyond oil producers’ control.
“The market has been reacting to perceptions of a possible supply shortage. The market remains well supplied,” he told a briefing.
“The projections for 2019 clearly show a possible rebuild of stocks,” he said of the supply and demand balance for next year.