According to industry insiders, the Organisation of Petroleum Exporting Countries (Opec) and its allies are expected to extend their production cuts into May to maintain market stability.

Despite the resumption of economic activities, Opec, led by Saudi Arabia, and non-Opec producers such as Russia will help stable oil production to sustain current price levels.

Saudi Arabia is only likely to reverse its voluntary one million BPD additional cut in two 500,000 BPD increments, according to JP Morgan.

When Opec and its members will meet on Thursday, the US investment bank assumes they will trade cautiously, largely rolling over supply cuts into May and extending Saudi Arabia's voluntary reduction by two months till the end of June.

Before the Opec+ meeting on April 1, it said, “We expect the alliance to begin adding production in 500,000 barrel per day (BPD) increments starting in June and lasting through August.”

According to a Reuters survey, Saudi Arabia and Russia are willing to support expanding Opec and its allies' oil cuts into June, as well as increasing their voluntary reductions to lift prices amid a new wave of coronavirus lockdowns.

On Tuesday, a Saudi oil source said that Opec+ had yet to make a decision and that policy discussions are yet to commence. Saudi Arabia was keen to push the cuts beyond May and into June, according to a source briefed on the matter on Monday.

“They don't think demand is high enough yet, and they don't want prices to fall,” the source said.

On March 4, the Opec+ group of producers, which is keeping back around eight million barrels per day of production, one million of which is a voluntary cut by Saudi Arabia. It shocked the market by agreeing to keep output broadly constant.

Last year, the group decided to cut 9.7 million BPD or around 10% of global production, but demand recovered and the group eased back.

Opec Secretary-General Mohammad Barkindo stressed the need to remain very vigilant and sensitive to changing market dynamics at a technical committee meeting on Tuesday, according to the organization. By 1334GMT, Brent crude was down $1.02, or 1.6 % to $63.96 per barrel. At $60.40 per barrel, West Texas Intermediate US oil was down $1.16, or 1.9 %.

“With the market volatility we've seen, OPEC+ will require to take a cautious stance once more,” reports ING bank. According to an ING research report, “we believe the community will likely keep output levels unaffected.”