OPEC+ leaning toward extension of oil output cuts

OPEC+, a group of major oil producers led by Saudi Arabia and Russia, are leading toward delaying the planned production boost to compensate for a slowdown in economic activity due to the second wave of coronavirus and rising Libyan oil output, sources told Reuters. 

Producers were due to raise output by 2 million barrels per day (bpd) in January as the global economy showed signs of life at the end of the third quarter with easing coronavirus lockdown restrictions. 

However, the number of new cases has surged across the globe over the past few weeks, reviving fears of a double-dip recession. As such, the OPEC+ OPEC+ is now considering delaying the increase.

"It looks like the extension is needed," a source told Reuters, citing "possible price drops and demand uncertainties" amid the second wave of the virus. 

OPEC+ implemented record output cuts of 9.7 million bpd from May 1 to rebalance the market. The deal was revised to 7.7 million bpd in the third quarter.