OPEC+ will slash oil production next month. Will Canadian gas prices change?

OPEC+ will slash its global output by two million barrels per day in November at a time when international inventories of crude oil remain tight.

Canadians wanting cheaper gas prices will see less oil on the marketplace next month thanks to a significant production cut by an alliance of oil-exporting nations.

In November, OPEC+ will slash its global output by two million barrels per day at a time when international inventories of crude oil remain tight. But will OPEC+’s cuts cause Canadian gas prices to rise?

Analysts don’t see that being the case.

“I don’t think it’s going to have much of an impact on crude price,” said Antoine Halff, an adjunct senior research scholar at the Center on Global Energy Policy at Columbia University.

“The crude price went up a little bit in the immediate aftermath of the OPEC meeting and the decision announcement, but it has since come off a little bit. … It’s clear that the market has not really been shaken.”

OPEC+, an intergovernmental organization of oil-exporting nations, said on Oct. 5 its scheduled cuts were made to support waning oil prices.

Oil had been trading well below its summer peaks because of fears that major global economies such as the U.S. or Europe will sink into recession due to high inflation, rising interest rates and energy uncertainty over Russia’s war on Ukraine.

Saudi Energy Minister Abdulaziz bin Salman stressed last month OPEC+’s stated role as a guardian of stable energy markets.