OPEC+ ends one chapter, opens another: Crude markets face a fork in the pipeline

OPEC+ just slammed the final page shut on its two-year production-cut playbook — but instead of delivering a tidy resolution, they’ve led crude traders straight to a fork in the pipeline.

The cartel’s latest move — a 547,000 barrel-per-day output bump — completes the reversal of the massive 2.2 million b/d supply cut orchestrated in 2023, a full year ahead of schedule. This wasn’t just symbolic; it was a power move aimed at clawing back market share and, intentionally or not, offering a tailwind to President Trump as he heads into a mid-term election cycle looking to keep pump prices tame.

For traders, this wraps up what had become a steady drip of supply increases from the Kingdom and its allies — a sort of shadow stimulus for a still-fragile global economy. But there’s another shoe waiting to drop: the fate of an additional 1.66 million barrels per day, still held off-market until at least 2026, remains a mystery.

That tranche is the real wildcard now — a dormant arsenal that could be redeployed or shelved depending on the macro backdrop, geopolitical pressure, and intra-OPEC+ politics. Sunday’s meeting didn’t offer answers, only more ambiguity. A follow-up session on September 7 now looms large.

In trader terms, OPEC+ just laid its cards on the table — but no one’s sure what hand they’re playing next.

The setup heading into Q4 is increasingly bearish. While demand has weathered 2025 reasonably well so far, the tailwinds are weakening. China is wobbling, and non-OPEC supply — particularly from US shale and Latin America — is swelling. The IEA is flagging a potential 2 million b/d surplus in Q4, which could turn into a sledgehammer against prices if demand softens further.

Markets are already sniffing out the pressure. Brent’s down nearly 7% year-to-date and now threatening to slip back toward $65 — and if Wall Street’s energy desks are right, a drift down to $60 could be in play. That level marks not just a round-number magnet, but also the zone where bids have repeatedly galvanized over the past few months. It’s where shale breakevens start to bite.

Goldman Sachs and JPMorgan both lean toward a tactical pause — no more hikes for now, just a cautious hold. And most traders Bloomberg surveyed agree: the coalition's next move is likely to be no move at all.

But if Riyadh is serious about playing the long game — about reasserting dominance over global barrels — then even soft demand and price erosion may not stop it from greenlighting the next 1.66 million b/d. Especially if Washington’s rhetoric shifts from tariffs to sanctions.

Which brings us to the geopolitical pressure cooker.

Trump is turning the heat up on Moscow, threatening secondary sanctions on Russian oil customers unless a ceasefire materializes. The message? Crude diplomacy is back, and it's laced with penalties. That puts OPEC+ in a vice grip — caught between Washington’s demands for cheaper oil and the political imperative to maintain unity with Russia.

Just days ago, Russian Deputy PM Novak made a rare trek to Riyadh to meet with Prince Abdulaziz. The visit wasn’t just for show — it signalled that the Saudis and Russians are still tied at the hip, at least for now. But how long can that alliance hold if U.S. foreign policy starts bleeding into OPEC+ strategy?

The coalition is walking a tightrope — threading a needle between economics and geopolitics, market share and market price, U.S. tariffs and Russian sanctions.

The next twist? It could come as early as September. Until then, crude trades on rumour, risk premium, and a growing sense that the script is far from finished.