What is Expected from Today's OPEC+ Major Producers Meeting?

A view shows the logo of the Organization of the Petroleum Exporting Countries (OPEC) outside its headquarters in Vienna, Austria, May 28, 2024. REUTERS/Leonhard Foeger/File Phot
A view shows the logo of the Organization of the Petroleum Exporting Countries (OPEC) outside its headquarters in Vienna, Austria, May 28, 2024. REUTERS/Leonhard Foeger/File Phot
TT

What is Expected from Today's OPEC+ Major Producers Meeting?

A view shows the logo of the Organization of the Petroleum Exporting Countries (OPEC) outside its headquarters in Vienna, Austria, May 28, 2024. REUTERS/Leonhard Foeger/File Phot
A view shows the logo of the Organization of the Petroleum Exporting Countries (OPEC) outside its headquarters in Vienna, Austria, May 28, 2024. REUTERS/Leonhard Foeger/File Phot

All eyes turn Sunday to a series of intensive and simultaneous ministerial meetings of the Organization of the Petroleum Exporting Countries (OPEC) and the OPEC+ alliance. These meetings are taking place under exceptional circumstances in global energy markets, as producers strive through these multiple platforms to lay out the foundations for a new phase of balance and strategic certainty.

Three consecutive meetings will be held today, reflecting the precise institutional nature of managing this phase. It begins with the OPEC Administrative Conference, followed by the 66th meeting of the Joint Ministerial Monitoring Committee (JMMC), responsible for monitoring compliance levels, ensuring alignment, and approving current compensation plans, culminating in the 41st ministerial meeting of the broader OPEC+ alliance—a meeting the global investment community is eagerly anticipating.

This coordinated effort is driven by positive momentum and close coordination, epitomized by the important meeting that brought together Saudi Energy Minister, Prince Abdulaziz bin Salman, with Russian Deputy Prime Minister Alexander Novak on the sidelines of the St. Petersburg International Economic Forum a few days ago.

The meeting reflected great optimism about the alliance's ability to lead the market with a flexible vision, with discussions focusing on the following positive points:

* Securing Energy Supplies: The Saudi affirmation that the world today needs "every molecule of energy" possible, reflecting the Kingdom's and the alliance's commitment to their role as a safety valve for the global economy.

* Flexibility and Readiness: OPEC+'s high ability to adapt and confront emergent geopolitical and logistical changes, while precisely revising future demand forecasts to ensure investment sustainability.

* Preparing for the Future: Coordination between the two poles aims to prepare a solid ground for the smooth and gradual return of supply flows once temporary logistical factors in the region subside.

Expectations and Targets

Instead of focusing on transient fluctuations, observers expect today's meeting to affirm collective commitment and reaffirm full solidarity among the seven major alliance countries – Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman – to ensure long-term market stability through the approval of flexible production policies. Sources told Reuters that production targets are expected to increase by approximately 188,000 barrels per day for next July, reflecting a cautious and measured approach that allows for quick and gradual intervention options based on daily market data.

Fitch

This flexible move aligns with the in-depth analysis presented by Fitch Ratings in its latest reports. The agency affirmed that the current closure of the Strait of Hormuz represents "a temporary and transient logistical shock" and in no way indicates a structural or permanent shift in global oil market trends.

The agency maintained its strategic view that global supplies will collectively exceed demand throughout 2026, based on the absence of any severe damage to oil infrastructure in the region, and the exceptional ability to achieve a rapid and intensive recovery of production in the Middle East once the strait is expected to reopen by the end of next July – assuming an actual closure period of approximately five months.

According to Fitch's base scenario, the average Brent crude price will hover around $87 per barrel throughout 2026, noting that the absence of production capacity due to the temporary logistical disruption will reduce supplies by approximately 2.9 million barrels per day compared to 2025.

However, the agency anticipates a sharp market rebound towards a surplus starting in September, with the surplus (oil glut) reaching approximately 4 million barrels per day in the last quarter of 2026, supported by strong growth from non-OPEC producers. This will exert downward pressure on prices, restoring the market to its natural equilibrium.

Fitch concludes that this dynamic lends significant effectiveness to OPEC+ plans, as the alliance possesses the ability to exceed previous quotas and pump additional quantities to ensure demand is met and prevent any structural shortages, solidifying the alliance's role as a strategic institution that transforms geopolitical challenges into real opportunities to support energy security, global economic growth, and sustainability.



OPEC Further Lowers 2026 Global Oil Demand Growth Forecast

FILE PHOTO: People walk past an installation depicting barrel of oil with the logo of Organization of the Petroleum Exporting Countries (OPEC)  in Baku, Azerbaijan November 19, 2024. REUTERS/Maxim Shemetov/File Photo
FILE PHOTO: People walk past an installation depicting barrel of oil with the logo of Organization of the Petroleum Exporting Countries (OPEC) in Baku, Azerbaijan November 19, 2024. REUTERS/Maxim Shemetov/File Photo
TT

OPEC Further Lowers 2026 Global Oil Demand Growth Forecast

FILE PHOTO: People walk past an installation depicting barrel of oil with the logo of Organization of the Petroleum Exporting Countries (OPEC)  in Baku, Azerbaijan November 19, 2024. REUTERS/Maxim Shemetov/File Photo
FILE PHOTO: People walk past an installation depicting barrel of oil with the logo of Organization of the Petroleum Exporting Countries (OPEC) in Baku, Azerbaijan November 19, 2024. REUTERS/Maxim Shemetov/File Photo

OPEC on Wednesday lowered its forecast for world oil demand growth in 2026 to 580,000 barrels per day, a copy of its monthly report showed, marking the fourth straight downward revision.

The producer group continues to see a smaller impact on consumption since the Iran war started than other forecasters such as the International Energy Agency, which expects demand to decline in 2026, Reuters reported.

The Organization of the Petroleum Exporting Countries also raised its forecast for 2027 oil demand growth, according to the report on OPEC's website.


Bank of America Pledges $250 Billion for US Infrastructure Financing

Signage is seen at the Bank of America Tower in Manhattan, New York City, New York, US, November 2, 2022. (Reuters)
Signage is seen at the Bank of America Tower in Manhattan, New York City, New York, US, November 2, 2022. (Reuters)
TT

Bank of America Pledges $250 Billion for US Infrastructure Financing

Signage is seen at the Bank of America Tower in Manhattan, New York City, New York, US, November 2, 2022. (Reuters)
Signage is seen at the Bank of America Tower in Manhattan, New York City, New York, US, November 2, 2022. (Reuters)

Bank of America said on Wednesday it plans to deploy $250 billion by July 2027 to support US digital and infrastructure projects, a move it says will boost the country's economic growth and help create tens of thousands of jobs.

The Wall Street bank said its "Critical Infrastructure Finance Initiative," launched on the heels of the nation's 250th anniversary celebrations, will provide primary market lending, investments, ‌capital markets services, ‌and banking and advisory offerings.

The announcement underscores how ‌major ⁠US financial institutions are seeking ⁠to capitalize on rising demand for AI data centers, critical minerals and energy infrastructure upgrades.

It comes days after Morgan Stanley said it would facilitate roughly $1.5 trillion over the next decade to finance technology and infrastructure projects.

Last year JPMorgan Chase launched a $1.5 trillion plan to facilitate, finance and invest in industries deemed critical to the US national security and economic resilience, including defense, ⁠energy and advanced manufacturing.

BOOSTING GROWTH, CREATING JOBS

Bank of ‌America's financing will target three areas: ‌digital infrastructure, including data centers and computing; energy and power infrastructure, including renewable generation ‌and energy storage; and core infrastructure such as transportation and natural gas.

"Meeting ‌America's growing infrastructure needs requires mobilizing capital at scale across increasingly interconnected sectors," said Karen Fang, global head of infrastructure and sustainable finance at Bank of America.

"Delivering these projects requires integrated financing solutions spanning corporate and project-level capital in both public ‌and private markets."

The $250 billion target will be measured over an 18-month period from January 1, 2026, to July ⁠4, 2027, ⁠the bank said.

"If we all do our job right, we should be deploying more capital," said Fang, who is also co-head of global capital solutions at BofA, when asked about potential deployment of more capital after July 2027.

Many projects require new infrastructure to be built before becoming operational, she said.

In the United States, infrastructure construction loans typically have terms of five to seven years. Once projects are completed and operating, they are often refinanced with longer-term debt lasting 10, 15 or 20 years, Fang said.

She said greater infrastructure investment would help drive economic growth and create long-term jobs.

"Infrastructure spending will lead to economic growth and prosperity," she said.


IEA Cuts 2026 Oil Demand Forecast Again as Hormuz Remains Shut

Boats and a vessel in the Strait of Hormuz, as seen from Musandam, Oman, August 3, 2026. (Reuters)
Boats and a vessel in the Strait of Hormuz, as seen from Musandam, Oman, August 3, 2026. (Reuters)
TT

IEA Cuts 2026 Oil Demand Forecast Again as Hormuz Remains Shut

Boats and a vessel in the Strait of Hormuz, as seen from Musandam, Oman, August 3, 2026. (Reuters)
Boats and a vessel in the Strait of Hormuz, as seen from Musandam, Oman, August 3, 2026. (Reuters)

The International Energy Agency on Wednesday sharply reduced its forecast for global oil demand this year, as supplies remain crimped by the closure of the Strait of Hormuz and high prices deter buyers.

Demand is expected to slump by 1.6 million barrels per day (mb/d), compared with its forecast slump of one million barrels in its previous monthly report in July.

Crude prices have remained well above levels seen before the US and Israeli attacks on Iran in late February, sparking a war that has seen Iran launch attacks at several Gulf countries.

Tehran also responded by effectively shutting down tanker and cargo traffic in the Strait of Hormuz, through which around one-fifth of global oil supplies usually transit.

"The ongoing closure of the Strait of Hormuz and elevated fuel prices continue to weigh on oil consumption," the Paris-based IEA said.

Despite a purported ceasefire and repeated claims that a deal to open the strait was imminent -- what the IEA referred to as "sudden diplomatic pivots" -- only a handful of ships are being let through, leading to volatile pricing on global oil markets.

The IEA said global supplies rose by 2.4 million barrels per day in July, to reach 101.5 mb/d, but that was still 6.3 mb/d lower than a year ago.

But "renewed hostilities and maritime disruptions in July and early August undermined the recovery efforts," the agency said.

It now expects global supply to fall by 4.3 mb/d on average this year, before recovering next year.

On the demand side, the IEA is projecting a return to growth in the fourth quarter of this year.