Oil Prices Surge as OPEC Weighs Rising Demand in Rich Countries

Oil prices rose above $75 a barrel as OPEC and a Russia-led group of producers met to weigh surging demand from the industrialized world—and delayed a decision about what to do about it.

Thursday’s meeting of the Organization of the Petroleum Exporting Countries comes at a time when some of the historical dynamics of the oil markets have been thrown upside down by the pandemic. Demand growth from the developed world, which for years has stagnated, is on a tear as it emerges furiously from Covid-19 lockdowns. Meanwhile, the developing world—the source of almost all new oil demand in years past—is still sputtering.

A week ago, OPEC and allied producers led by Russia were leaning toward boosting production by half a million barrels a day, with more additions possible later in the year, The Wall Street Journal reported.

Going into formal deliberations being held virtually Thursday, Saudi Arabia, OPEC’s de facto leader, and Russia had agreed to take up a proposal that includes a boost of about half a million barrels a day starting in August, according to people familiar with the talks, and then gradually increasing so-called OPEC+ output by a total two million barrels through December.

But in a surprise move, OPEC said the group would postpone a decision until Friday. The United Arab Emirates objected to the proposed increase amid concerns about the robustness of the recovery, delegates said.