HSBC expects OPEC+ to accelerate oil output quota increases in the second and third quarters of 2026 as the producer group focuses on regaining market share, the bank said on Tuesday.
OPEC+ agreed on Sunday a small oil output increase for December and a pause in increases in the first quarter of next year. It has raised output targets by around 2.9 million barrels per day – or around 2.7% of global supply – since April, but slowed the pace from October amid predictions of an oversupply.
HSBC said that OPEC+’s latest decision signals caution over seasonally weaker demand but does not indicate a shift in strategy.
“Even now that OPEC+ has paused, we remain very sceptical about the group reversing the unwinding and cutting again. We expect it to consider doing (that) only if Brent remains below $55/b for a prolonged period,” the bank said.
HSBC now forecasts a 2.7 million barrels per day (mbpd) oversupply in the first quarter of 2026, down from a previous estimate of 3 mbpd, and expects an average oversupply of 2.1 mbpd for the full year, compared with 2.4 mbpd previously.
It said the first-quarter 2026 pause has a slightly positive impact on oil balances, but not enough to prevent a large surplus next year.
(Reporting by Anushree Mukherjee and Anmol Choubey in Bengaluru; Editing by Emelia Sithole-Matarise)