The monthly ministerial gathering of the OPEC+
members takes place on Tuesday as the recovery of the demand continues steadily,
despite the rapid spread of the Omicron variant of the Coronavirus.
With the revival of the JCPOA, 2015 Iran nuclear
deal, oscillating between mild optimism and abject failure, the group has come
under pressure from the leading economies in the world to increase its
production quota in proportion to the growing demand.
At present, the possibility of Iranian contribution
to the crude oil markets appears to be remote.
For the past few weeks, the US crude inventories
have been falling, giving hope to the notion that the demand is approaching the
pre-pandemic level – at last; the data from both the API, American Petroleum
Institute, and the EIA, US Energy Information Administration, clearly showed
that was the case.
Even if the producers choose to overlook the clear fact
on emotional grounds, the correlation between the rise in consumption and
falling prices is all too obvious.
As far as the OPEC+ is concerned, the prospect of
collective release of the SPRs, Strategic Petroleum Reserves, casts a worrying
shadow, if the crude oil price goes up beyond $80 a barrel, when the Western
consumers, in particular and global customers, in general start feeling the
pinch.
Despite the increase in demand, in general, the woes
of the airline industry continue to affect the demand for Jet fuel due to the
spread of the Omicron – and of course, the entire airline industry.
Since the data clearly suggest the new variant is
much milder than the dreaded Delta variant, the hope of leaving the pandemic
behind us in 2022 is finally taking the roots in the psyche of the anxious
investors.
When the joint technical committee of the OPEC+
meets on Monday, the body is supposed to discuss the appointment of the next
Secretary General as well.
The name of Haitham al-Ghais of Kuwait has been put
forward as the only candidate so far to succeed Mohammad Barkindo of Nigeria,
the current Secretary General.
Mr al-Ghais is known as a competent analyst of the
crude oil markets, which co-exist with turbulent fluctuations. There are hopes
he will be chosen to lead the organisation at a crucial time, both politically
and economically.
