Informed sources indicated that Saudi Arabia and the United Arab Emirates are ready to pump a “significant increase” in oil production if the world faces a severe supply crisis this winter.
When the Organization of the Petroleum Exporting Countries and its allies, in what is known as the OPEC + alliance, decided to raise production by only 100,000 barrels per day, it broke one of the rules with a rare reference to the group’s excess production capacity.
The statement pointed to the availability of “extremely limited” spare production capacity, saying that there was a need to maintain it in anticipation of “severe supply disruptions”. This is explained at first glance as an admission that Saudi Arabia, the leader of OPEC, has almost no room to increase production, as French President Emmanuel Macron mentioned in an interview with his American counterpart Joe Biden last month.
Three sources, who spoke on condition of anonymity due to the sensitivity of the matter, said that Saudi Arabia and the UAE might pump “much more” but would only do so if the supply crisis worsened.
“With the possibility of no gas in Europe this winter, and with the possibility of imposing a price cap on Russian oil sales in the new year, we cannot pump every barrel of oil into the market at the moment,” one of the sources said.
The sources did not specify the size of any increase, but said that Riyadh, Abu Dhabi and some other OPEC members have between 2.0 and 2.7 million barrels per day of spare production capacity.