OPEC+ to Increase Oil Production by 411,000 Barrels Per Day in July
The decision marks the third consecutive increase in production as the group aims to recover output amid stable economic outlook.
OPEC+ has announced an increase in oil production by 411,000 barrels per day (bpd) for July, marking the third consecutive monthly rise, bringing the total adjusted production increase over the past four months to 1.37 million barrels per day (mbd).
This decision was made during a virtual meeting led by Saudi Arabia and Russia, aiming to reverse previous voluntary cuts despite downward pressure on crude prices.
Ministers from Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman, who previously contributed to a combined reduction of 2.2 mbd to stabilize the market during the COVID-19 pandemic, also participated in the discussions.
Originally, the plan anticipated a gradual recovery of production with monthly increases of 137,000 bpd over 18 months; however, these eight nations unexpectedly tripled the volume increase for May and June, a decision they have reiterated this July.
The ministers justified the increase citing a positive outlook for the global economy in the medium term.
According to OPEC's statement, "In view of stable global economic prospects and sound market fundamentals...
the eight participating countries will apply an adjustment of production of 411,000 barrels per day in July."
Despite this optimistic characterization, analysts express a more cautious perspective, highlighting uncertainties stemming from various global conflicts, including the US-China trade tensions, the ongoing situation in the Middle East, the war in Ukraine, and issues surrounding Iran's nuclear program.
The price of Brent crude, a benchmark for Europe, closed below $64 per barrel on Friday, reflecting a decline of nearly 15% over the past month, having briefly dipped below the $60 mark, marking its lowest levels in four years.
The meeting also addressed ongoing compliance issues regarding production quotas by certain members, including Kazakhstan and Iraq.
The statement released indicated that the eight nations reaffirmed their intention to fully compensate for any volumes produced in excess since January 2024.
The next meeting to evaluate production for August is scheduled for July 6.
This decision was made during a virtual meeting led by Saudi Arabia and Russia, aiming to reverse previous voluntary cuts despite downward pressure on crude prices.
Ministers from Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman, who previously contributed to a combined reduction of 2.2 mbd to stabilize the market during the COVID-19 pandemic, also participated in the discussions.
Originally, the plan anticipated a gradual recovery of production with monthly increases of 137,000 bpd over 18 months; however, these eight nations unexpectedly tripled the volume increase for May and June, a decision they have reiterated this July.
The ministers justified the increase citing a positive outlook for the global economy in the medium term.
According to OPEC's statement, "In view of stable global economic prospects and sound market fundamentals...
the eight participating countries will apply an adjustment of production of 411,000 barrels per day in July."
Despite this optimistic characterization, analysts express a more cautious perspective, highlighting uncertainties stemming from various global conflicts, including the US-China trade tensions, the ongoing situation in the Middle East, the war in Ukraine, and issues surrounding Iran's nuclear program.
The price of Brent crude, a benchmark for Europe, closed below $64 per barrel on Friday, reflecting a decline of nearly 15% over the past month, having briefly dipped below the $60 mark, marking its lowest levels in four years.
The meeting also addressed ongoing compliance issues regarding production quotas by certain members, including Kazakhstan and Iraq.
The statement released indicated that the eight nations reaffirmed their intention to fully compensate for any volumes produced in excess since January 2024.
The next meeting to evaluate production for August is scheduled for July 6.
Translation:
Translated by AI
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