Market Analysis by Antonio Di Giacomo, Financial Markets Analyst for LATAM at XS
– May 29, 2025 –
“Crude oil prices have seen a significant rebound following the latest OPEC+ meeting, reaching $62.50 per barrel for WTI and $65.00 for Brent. This increase is a result of the decisions made by the producers’ alliance, including the creation of a new mechanism to define production baselines, which will take effect starting in 2027. This system aims to establish more realistic quotas based on each member country’s current maximum production capacity.
The goal of this new strategy is to offer greater equity in quota allocation within the group, taking into the differences in productive capacity among . With this measure, OPEC+ aims to mitigate internal tensions and enhance the effectiveness of its production cut policies, which are crucial for maintaining stability in the global crude oil market.
Although the organization did not alter its current cuts, it is anticipated that eight countries may agree to increase production in July. This increase, estimated at 411,000 barrels per day, is part of a coordinated strategy between Saudi Arabia and Russia, two of the group’s most influential leaders. The dual objective is to control the oversupply from certain and regain market share on a global scale.
These decisions come in the context of a price recovery following a sharp drop in April, which brought oil prices to levels not seen in the past four years. A combination of factors, including global economic uncertainty, geopolitical tensions, and fluctuations in demand, has driven recent volatility.
OPEC+ is seeking to address these challenges through more precise and coordinated production planning. Implementing the new baselines would enable more appropriate limits tailored to each country’s current conditions, facilitating quota compliance and enhancing the group’s credibility.
The market has reacted positively to these announcements, interpreting the agreements as a sign of cohesion and control by the cartel. This perception is crucial for investor confidence, especially in an environment where crude prices remain sensitive to any sign of imbalance between supply and demand.
The group’s next meeting, scheduled for November 30, will be key to assessing the impact of these measures and defining production policy for 2026 and beyond. The group is expected to continue adapting its decisions to market changes, maintaining stability, and ensuring sustainable prices for exporting countries.