OPEC President: Oil supply is now not enough, oil companies didn't invest enough

The OPEC President on Wednesday said that oil supply is not now enough and blamed oil companies for not investing enough. There is a quick rise in demand and we need to respond, the President noted, adding that we have to invest as quick as possible so supply can meet demand. Oil production has increased over the last few months, he said, but there is still a gap between targets and output. The main question, the President said, is how long it will take to produce more crude oil, before reiterating OPEC's mission to bring oil market stability and balance.

We need a commitment from all oil market players, including non-OPEC+ member nations, to increase oil supply. The OPEC President continued that there are no immediate solutions to high oil prices, and warned that while members of the organisation committed to investing more in the oil industry to lift production, this would take time. 

Market Reaction

Oil prices have seem some negative ticks in recent trade, with front-month WTI futures dipping back to the $93.00 area from earlier session highs in the $93.40s in recent trade. Traders will likely bet increasingly on the idea that OPEC+ might agree to a larger output hike at its next meeting, or that the likes of the Saudis and UAE will increase output by a larger margin to make up for shortfalls in output from other OPEC+ nations.