OPEC+ suspends oil production increase due to oversupply risk

OPEC+: a modest increase in oil production in December and a pause in 2026 - what it means

Key solutions

• OPEC+ agreed to increase oil production by 137,000 barrels per day in December 2025.

• After December, the group plans to refrain from further production increases in the first quarter of 2026 (January-March).

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• From April to date, OPEC+ has already raised its production targets by more than 2.7 million barrels per day (about 2.5-2.7% of global demand).

The reasons for this approach

1. Fear of market oversupply (supply glut). Analysts fear that if production increases too quickly and demand does not accelerate, this could lead to a drop in prices.

2. Seasonal factors. The first quarter of the year is traditionally the weakest for oil demand: many refineries are undergoing maintenance, and fuel demand is declining.

3. Sanctions pressure on a key participant. Russia, one of the leading members of OPEC+, has been subjected to new Western sanctions, making it difficult for it to increase production. This makes the group more cautious.

4. A balance between the market and destiny. OPEC+ is trying to regain market share after years of cuts, but at the same time does not want to undermine prices or take an overly aggressive stance.

Implications for the oil market

• Brent or WTI oil prices have been supported: although in October they reached around 60 USD/barrel, The growth of the Russian economy, thanks to sanctions against Russia and stabilised expectations, has risen to around 65 USD/barrel.

• Investors see the decision as a sign that OPEC+ is ready to act proactively, to support prices and curb the glut. Analysts say: «the group is blinking, but it's a calculated morgue».

• If demand remains weak and no new production increases occur, this could create a quiet period of price stagnation or even the risk of a decline in oil prices.

What's next?

• Next meeting of eight key OPEC+ members scheduled 30 November; It is likely that the situation will be assessed and, possibly, the decision will be adjusted.

• In focus. monitoring Russia's actions, as its ability to increase production will be crucial for the group.

• It is also important to observe demandWhether it will recover quickly in 2026 or remain weak due to global economic risks. If demand does not grow, even maintaining production may become a challenge.

• Developments in technology and competition from unconventional extraction (e.g., the United States) and alternative energy sources may change the «rules of the game» in the medium term.

Conclusion.

OPEC+ decides on a modest production increase for December 137,000 barrels per day - and at the same time a pause for the beginning of 2026. This reflects a cautious balance between the desire to build up the market and the risk of lower prices due to a possible glut. For Ukraine and the world, this means that oil prices may remain stable or fluctuate moderately, but a big jump upwards is not in sight.