OPEC+ confirmed that a 100k barrels per day increase in quotas will be spread across all OPEC+ countries in a statement about the decision. Perhaps more important is an acknowledgement that extra oil is in short supply.
"The Meeting noted that the severely limited availability of excess capacity necessitates utilizing it with great caution in response to severe supply disruptions.
The Meeting noted that chronic underinvestment in the oil sector has reduced excess capacities along the value chain (upstream/midstream/downstream).
The Meeting highlighted with particular concern that insufficient investment into the upstream sector will impact the availability of adequate supply in a timely manner to meet growing demand beyond 2023 from non-participating non-OPEC oil-producing countries, some OPEC Member Countries and participating non-OPEC oil-producing countries."
The US will stop tapping the SPR in October. That coincides with the end of driving season but it looks like Europe will be burning a lot of oil this winter to replace natural gas.
Exxon last week highlighted the natural 7% annual decline in oilfields and that not enough money is being spent to replace it.
OPEC running out of spare capacity has long been a catalyst of oil bulls and it looks like we're pretty much there.
The production table shows a measly 26k bpd from Saudi Arabia, 7k from Kuwait and 9k from the UAE as the only new barrels that are likely to enter the market.
WTI crude oil remains higher by $1.69 to $96.10.
