OPEC+ Proposes New Production Capacity Framework as Crude Oil Quota Battle Begins; Plastic Futures Surge and Fall, PC Drops 300

OPEC+ representatives will gather in Vienna this week.A preliminary discussion was held on the program for updating the estimation of member countries' production capacity.

This alliance, composed of 22 countries, plans to determine a new production baseline based on the results of capacity assessments.Set production targets for 2027.。

According to informed sources, at the meeting scheduled for September 18-19, delegates hope to reach a consensus on a mechanism for assessing the maximum sustainable crude oil production capacity of each member country.The Secretariat aims to submit a feasible proposal to the OPEC+ ministers by the end of the year.

According to data from the International Energy Agency (IEA), the maximum sustainable capacity of OPEC+ including Mexico is 47.9 million barrels per day. Based on the average data from third-party institutions such as Argus, the alliance's crude oil production in August increased by 509,000 barrels per day compared to the previous month, reaching 42.4 million barrels per day.

OPEC+ originally planned to implement the new production baseline in 2025.However, due to internal disagreements over the assessment process—including independent evaluations by Rystad, Wood Mackenzie, and IHS—the plan was postponed to 2026 and then to 2027.

Even if OPEC+ reaches an agreement on a new framework for capacity assessment, implementation still faces challenges.Countries like Iraq and Nigeria have requested an increase in the baseline, but it is unclear whether these demands reflect actual capacity growth. Angola has withdrawn from OPEC in 2024 due to its production target being lower than expected.

Recently, as the eight core member countries have gradually lifted large-scale production cuts, OPEC+'s spare capacity has become a focus of the market. Due to limitations in upstream and midstream facilities,It is uncertain whether countries like Russia and Iraq can return to production levels before the cuts in the coming months.

Since April, OPEC has been steadily increasing production, completely reversing the first round of 2.5 million barrels per day cuts by September, which is equivalent to about 2.4% of global demand. The latest production policy in October continues this trend by lifting the second round of production cuts ahead of schedule by more than a year. However, actual production growth often falls short of targets because most member countries are producing close to their capacity limits.

Compliance issues have further complicated the situation. Countries like Kazakhstan, Iraq, and the UAE have exceeded their production quotas, prompting Saudi Arabia to advocate for stricter adherence to the regulations. OPEC emphasized in a statement that member countries should fully comply with the Declaration of Cooperation and compensate for the production excess since January 2024, aiming to restore discipline within the alliance.

Latest Plastic Prices on September 17

Due to the looming risk of US sanctions against Russia, crude oil surged above the 500 mark intraday, rising by 1.5%. In early trading today, plastic futures spiked and then pulled back, while the spot market showed mixed movements.