An oil drum with featuring the logo of the Organization of the Petroleum Exporting Countries (OPEC) at the COP29 climate conference in Baku, Azerbaijan, on Wednesday, Nov. 13, 2024.
Andrey Rudakov | Bloomberg | Getty Images
OPEC+ agreed on Saturday to hike July oil output by 411,000 barrels per day (bpd), the same as in May and June, as the group of oil-producing countries continues to bring back supply more rapidly than earlier planned.
Eight OPEC+ countries have been raising output faster than scheduled since May, even though the extra supply has weighed on prices. The strategy of group leaders Saudi Arabia and Russia is aimed partly at punishing over-producing allies and to win back market share, Reuters has reported.
The eight countries agreed to the July increase in an online meeting on Saturday. They also discussed other options, an OPEC+ delegate said. On Friday, sources familiar with OPEC+ talks had said they could discuss a larger hike.
In a statement issued after the meeting, OPEC+ cited a “steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories” as its reasoning for the July increase.
OPEC+ pumps about half of the world’s oil and includes OPEC members and allies such as Russia. While the eight are raising supply, some are being asked to temper those increases to compensate for overproducing in past months.
Kazakhstan had said on Thursday that it would not cut production, prompting speculation that OPEC+ might go for a July increase larger than 411,000 bpd.
Oil prices fell to a four-year low in April, slipping below $60 per barrel after OPEC+ said it was tripling its output hike in May and as U.S. President Donald Trump’s tariffs raised concerns about global economic weakness. Prices closed just below $63 on Friday.
Global oil demand is expected to grow by an average of 775,000 bpd in 2025, according to a Reuters poll of analysts published on Friday, while the International Energy Agency in its latest outlook saw an increase of 740,000 bpd.
The OPEC+ output increases that began in April are aimed at unwinding some 2.2 million bpd in voluntary output cuts by the eight members. Two other layers of cuts are expected to remain in place until the end of 2026.
