Oil producing countries have been trimming oil output worldwide. OPEC and its allies set this trend with the pact on oil production cuts. However, the cartel finds it premature to greenlight more cuts despite declining oil prices.

Citing Mohammad Barkindo, OPEC Secretary General, the participants of the deal are committed to their individual quotas of production cuts. In case of full compliance with the individual quotas, the participants will slash the oil output by over 136% by the year-end, Mohammad Barkindo estimated.

From his viewpoint, the ongoing turbulence in the crude market does not relate to the balance between supply and demand. He noted that geopolitical tensions dented the efficiency of the OPEC+ deal. One of the latest jolts was drone attacks on major Saudi Arabia’s oil facilities in late September. Nevertheless, despite force majeure, OPEC believes that Riyadh is capable of reviving its oil supplies to the full.

Another geopolitical headwind is a standoff between Saudi Arabia and Iran. The Kingdom accused Tehran of the airstrikes on Saudi’s oil infrastructure. OPEC General Secretary thinks that Russia could act as a third party to settle the conflict between the old rivals.