Global oil markets face significant tightening unless the Organization of Oil Exporting Countries and its OPEC+ allies reach a resolution and agree to boost supply, warns the International Energy Agency in its latest monthly reports, writes Bloomberg News.

OPEC+ is locked in a standstill because of a disagreement between Saudi Arabia and the United Arab Emirates that blocked a agreement to boost oil supply.

As the situation currently stands, the cartel will maintain output levels unchanged throughout next month, even though fuel demand has rebounded to pre-pandemic levels to due a spike in summer season consumption.

According to the IEA, deadlocked negotiations could result in a “deepening supply deficit":

"[T]he potential for high fuel prices [threatens] to stoke inflation and damage a fragile economic recovery,” the media cites the agency saying in its monthly report.

Brent is presently trading for more than USD 75 a barrel, which is nearly the highest price seen in two years.

English Edit: Daniel Frank Christensen

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