OPEC+ is poised to consider a more substantial oil production increase for July than the previously agreed 411,000 barrels per day , according to sources familiar with the group’s deliberations. The move reflects escalating internal tensions and strategic manoeuvring within the alliance.
Eight member countries have been accelerating output beyond initial plans, a strategy reportedly orchestrated by Saudi Arabia and Russia to discipline non-compliant allies and reclaim market share. This approach has contributed to a decline in oil prices, which dipped below $60 per barrel in April before stabilising around $65.
Kazakhstan’s recent declaration that it will not adhere to production cuts has intensified debates within OPEC+. The nation’s stance has sparked discussions about implementing a larger output hike for July, as some members seek to address the imbalance caused by overproduction.
The potential increase comes amid a broader strategy to unwind the 2.2 million bpd voluntary cuts introduced in 2024. The group has already implemented 411,000 bpd hikes for May and June, and sources indicate that similar or larger increments may continue through October.
Analysts warn that further increases could exacerbate the existing global surplus, estimated at 2.2 million bpd, and potentially lead to a 10% drop in crude oil prices. The market remains sensitive to OPEC+’s decisions, with concerns about demand growth and geopolitical uncertainties influencing price forecasts.
The alliance’s internal dynamics are further complicated by differing national interests. While some members advocate for higher production baselines to reflect increased capacities, others face declining output. These disparities have led to contentious debates over future quotas and the group’s overall strategy.
Follow Arabian Post
Select Arabian Post as your preferred source on Google and MSN News for trusted business news and Arab politics and updates.
