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Opec+ Meets This Sunday (5) to Decide On Oil Production Increase Amid Falling Barrel Prices and Petrobras Devaluation.
Opec+ Evaluates Increasing Oil Production and Triggers New Price Decline
The Organization of the Petroleum Exporting Countries and allies (Opec+), which includes Russia and other sector powers, is holding a decisive virtual meeting this Sunday (5) to determine whether it will again increase oil production.
The possible increase occurs amid a significant drop in barrel prices, which plunged more than 7% last week.
Expectations are that the group will maintain the expansion rate of 137,000 barrels per day in November, the same level approved for October.
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The measure aims to recover Saudi Arabia’s market share, the cartel leader, after a long period of supply cuts. However, this strategy has been pressuring the commodity’s value and directly impacting companies like Petrobras, whose shares have fallen sharply.
Falling Oil Prices Worry the Global Market
Last week, prices for oil futures contracts saw one of the largest declines of the year.
Brent, the international benchmark traded in London, dropped 7.02%, falling from US$ 69.50 to US$ 64.53 per barrel. Meanwhile, WTI, traded on the New York Stock Exchange (NYMEX), plummeted 7.33%, closing the week at US$ 60.88.
The movement reflects fears of a global supply glut if Opec+ continues to expand production. Analysts indicate that the market has already been reacting in anticipation of the group’s decision, which intensifies volatility.
Moreover, the political context also weighs heavily. U.S. President Donald Trump issued an ultimatum to Hamas to end the conflict with Israel, temporarily causing a price spike on Friday. Even so, the situation remains unstable, and investors are cautious.
Opec+ Strategy: Regaining Lost Ground
Since April, Opec+ has been trying to reverse production cuts that reached 4.15 million barrels per day, equivalent to nearly 4% of global production.
The decision to increase supply aims to regain market share, especially in light of the advance of independent producers and growing pressure for renewable energies.
Saudi Arabia, the leading voice within the organization, has been spearheading this movement, despite criticism that increasing production could destabilize global prices.
On the other hand, Russia supports the measure, betting on recovering revenues from large-scale exports.
However, experts warn that the balance is delicate. A too rapid increase could trigger another round of price declines, complicating inflation management and reducing the attractiveness of investments in the energy sector.
Petrobras Feels Impact of Opec+ Decision
The uncertainty about the future of Opec+ production has driven down Petrobras shares in the past week.
The ordinary shares (PETR3), which carry voting rights at meetings, fell 5.81%, dropping from R$ 35.11 to R$ 33.07. Meanwhile, the preferred shares (PETR4), which have priority in dividend distribution, declined by 3.9%, closing at R$ 31.00.
The Brazilian state-owned company, responsible for about 5 million barrels per day, according to data from the National Petroleum Agency (ANP), is directly influenced by Opec+ decisions.
When international prices fall, the company’s market value also suffers, reflecting a loss of confidence from investors.
Additionally, oil volatility pressures Petrobras’s plans to maintain its investments in exploration and refining, especially amid political uncertainties and the ongoing energy transition.
What to Expect After the Meeting
If the production increase is confirmed, the market is expected to remain pressured in the coming weeks. This is because a greater supply tends to keep prices low, directly affecting barrel values and the shares of major companies in the sector.
Furthermore, experts state that the recovery of prices will heavily depend on global energy demand. However, this indicator has been showing signs of slowing down, particularly in light of economic instability and weakening consumption in major powers.
On the other hand, if Opec+ decides to maintain current cuts, the scenario could change rapidly. In this case, barrel prices are likely to react positively, which would provide temporary relief for companies like Petrobras and other producers dependent on oil exports.
Even so, the market remains sensitive and subject to immediate reactions. Therefore, Opec+’s decision this Sunday will be crucial for the direction of oil prices, the global economy, and Petrobras’s shares in the coming weeks.
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