OPEC: The release of the US strategic petroleum reserve may exacerbate excess capacity in 2022

OPEC insiders said the group expects major oil consumers, led by the United States, to release oil reserves, increasing excess capacity in the oil market to 1.
1 million barrels per day
.

Ahead of the December 2 OPEC+ ministerial meeting, OPEC's economic and technological think tank, the Economic Commission Board (ECB), met early this week to discuss whether to continue its production increase plan
.

The ECB expects the oil market to have 400,000 barrels of excess capacity per day by December, and if consumer countries continue to release oil inventories, the excess capacity will expand to 2.
3 million barrels in January and 3.
7 million barrels
in February next year, the source said.

The U.
S.
said on Tuesday that it plans to work with Britain, China, India, South Korea and Japan to release 50 million barrels of oil from its strategic reserves to help the price market "cool down"
as OPEC ignores its repeated calls to increase production.

Goldman Sachs estimates that although the total scale of the release reached 70 million to 80 million barrels, it was not enough for the world's oil consumption in a day, only a drop in the ocean
.

Bloomberg News was the first to report on the ECB's findings
.

OPEC+ has previously rejected the Biden administration's request for an increase in production, even as it lifted its target of 3.
8 million bpd at the end of December
.

Since August, OPEC+ has raised its output target by 400,000 bpd, saying that output is enough because excess capacity in the oil market is expected to grow
significantly next year.

As a result, some market analysts, including JPMorgan Chase personnel, believe that OPEC may pause production
increases after major consumers release inventories.

OPEC+ insiders told Reuters that despite the release of U.
S.
Strategic Petroleum Reserve (SPR) data, the organization has not yet begun planning to suspend production increases in January
.