OPEC President Suhail Mohamed Al Mazrouei
UAE's Oil Minister OPEC President Suhail Mohamed Al Mazrouei and OPEC Secretary General Mohammad Barkindo address a news conference after an OPEC meeting in Vienna, AustriaREUTERS/Heinz-Peter Bader

It seems that the fluctuations in oil prices are here to stay. The Organization of the Petroleum Exporting Countries has hinted that it will consider a cut in the oil production starting next year.

The development has come at the backdrop of rising oil prices during the summers and political pressure from US President Donald Trump resulting in Saudi Arabia, Russia and other producers increasing the outputs. The oil producing companies are now expected to discuss the future production post-US midterm elections.

Bob McNally, president of Rapidan Energy Advisors LLC, a consultant in Washington told Bloomberg, "The message from OPEC looks like: fasten the seat belts." He further added that The cartel looks sets to "put the pedal to the metal to boost production, and then immediately slam the brakes pretty hard and talk about cutting supply."

The delegates of the OPEC said that the Ministers from the Organization of Petroleum Exporting Countries and its allies are scheduled to meet in Abu Dhabi on Sunday to deliberate the scenarios which include the possibility of cutting down oil production again next year.

However, there are few challenges which lie ahead of Saudi-led group as it will have to once again win the support of Russia. Additionally, the step could also trigger a backlash from US president Trump who has demanded an uninterrupted supply of oil, especially after the second round of economic sanctions comes into place.

Another cut in the oil production would mean the complete reversal for which this intergovernmental organization was formed that is preserving stability and careful market stewardship.

Earlier this year, oil prices across the globe started shooting up due to multiple factors including production shortfalls from sanctions on Iran and Venezuela's economic collapse. Supply shortages from two of its members threatened the biggest supply disruption of the decade; the crude oil prices reached above $86 a barrel last month.

The oil suppliers are of the opinion that the unexpected waivers for buyers of Iranian crude have diluted the impact of US economic sanctions and the trade war between US and China could further arrest the oil demand in the emerging markets.