OPEC+ has announced it will increase oil production by 411,000 barrels per day in July, marking the third consecutive monthly increment of this volume.
OPEC+ is a coalition comprising the Organisation of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia, and various allies, particularly Russia. On Saturday, eight cartel members, including Saudi Arabia and Russia, held a video conference to discuss the new production increase.
This decision reflects a departure from OPEC+’s traditional strategy of maintaining high oil prices, as the increased production has led to a significant drop in crude oil prices, with Brent crude currently priced slightly above $60 per barrel.
Saudi Arabia reportedly aims to reprimand overproducing members like Kazakhstan and Iraq, while recovering market share lost to US shale oil companies. The move also seeks to please US President Donald Trump, who is keen on showcasing low fuel prices domestically.
Despite reaching a consensus on the production increase, Bloomberg sources indicate that some members, such as Russia, Algeria, and Oman, were in favour of pausing the strategy. The decision carries implications for OPEC+ countries, as it results in reduced revenue streams.
