HSBC forecasts that OPEC+ will increase its output more rapidly in late 2026, even after a planned pause in the first quarter of 2026.
Despite the Q1 2026 pause, HSBC maintains a bearish outlook on oil balances, predicting a substantial surplus for the entirety of 2026.
OPEC+ is expected to resume accelerating its unwind from spring 2026 to reclaim market share, with a potential policy reversal only if Brent oil prices consistently drop below $55.
HSBC is sticking with the bear case on balances, saying OPEC+ will pick up the pace of quota increases in Q2–Q3 2026 as the group leans back into market share. The call lands two days after OPEC+ signed off on a small 137,000 bpd hike for December and—crucially—a pause on further hikes in January–March 2026, a tactical nod to soft seasonal demand and growing surplus chatter.
On the facts: eight core members—Saudi Arabia, Russia, the UAE, Iraq, Kuwait, Oman, Kazakhstan, and Algeria—are the ones adjusting volumes, and since April the alliance has announced plans to gradually restore up to 2.9 mbpd of output, though only part of that has been implemented as the group slows the pace of its unwind.
HSBC’s price and balance math has edged less bearish at the margin: the bank now pegs a 2.7 mbpd surplus in Q1 2026 (from 3.0 prior) and a 2.1 mbpd average surplus for full-year 2026 (from 2.4). The pause modestly improves near-term balances, but not enough—by HSBC’s read—to head off a large surplus next year. The bank also reiterates that it would only expect OPEC+ to reverse the current unwind if Brent spends a prolonged stretch below $55.
The optics matter: pausing in Q1 buys time to see how U.S. sanctions on Russian producers ripple through global flows and whether Asia’s big buyers reshuffle barrels without major friction. It also avoids front-running refinery maintenance season with fresh supply. None of that signals a strategic pivot away from unwinding; it’s pacing.
Bottom line for 2026: unless prices crack hard, HSBC expects OPEC+ to resume accelerating the unwind from spring, testing how much market share the group can claw back while keeping a floor under prices. For now, the alliance is threading the needle—increment in December, pause in Q1, and reassess with one eye on inventories and the other on Brent.
By Julianne Geiger for Oilprice.com
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