ANKARA (AA) – The decision by the Organization of Petroleum Exporting Countries (OPEC) and allies, known as OPEC+, to cut oil production by 2 million barrels per day (bpd) starting in November will have a muted impact on global oil market since the actual output cuts will be smaller, Fitch Ratings said Monday.

“The recent increases in global oil inventories suggest that the market is in a production surplus,” the global rating agency said in a report.

“We expect OPEC+ to target a broad balance in the oil market by changing production quotas and available crude supplies, although it may become increasingly difficult to achieve a consensus among the members due to demand uncertainties and the recession in large developed markets,” it added.

Fitch said Saudi Arabia and the United Arab Emirates will have to make the largest actual cuts in oil production, while many other OPEC countries will have some room under their quotas to increase production.

While Kuwait and Iraq are required to cut oil production, relative to their August output level, Nigeria, Angola, and Azerbaijan have some room to increase their crude production, according to the report.

“A recessionary economic outlook will lead to lower oil demand, although demand has recently been boosted by switches from gas to oil in energy generation, driven by soaring natural gas prices, particularly in Europe and the Middle East,” the report said.

The agency noted that it expects price volatility to remain high in the global oil market in the short term due to geopolitical factors that have the potential to significantly shift supply patterns and cause large price fluctuations.

Some of these major geopolitical factors are additional Western sanctions that could lead to further reduction in Russian oil exports, and an agreement on the Iran nuclear deal that could see oil production rising in the country, according to Fitch.

While the US has been critical about the OPEC+ decision to lower oil production, President Joe Biden last week announced the release of an additional 10 million barrels from the US’ strategic petroleum reserves to global oil markets starting next month.