OPEC+ cartel to hike oil production by 188,000 barrels a day

New Delhi: The seven OPEC+ countries announced on Sunday that they would increase their production by another 188,000 barrels per day from July 2026 as part of “their collective commitment to support oil market stability”.

The OPEC+ oil cartel, comprising Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, took the decision after a virtual meeting on Sunday to “review global market conditions and outlook”, according to a press statement.

Leading producers Saudi Arabia and Russia will each increase production by 62,000 barrels a day, while the rest will be shared by the other five members.

The seven core members of OPEC+ have already increased their output quotas from April to June by almost 600,000 barrels per day. The decision came following the disruption in energy supplies due to the Middle East conflict, which has caused global oil prices to surge past the $100 a barrel mark.

The latest increase comes on top of the additional voluntary adjustments announced in April 2023. The additional voluntary adjustments announced in April 2023 may be returned in part or in full, subject to evolving market conditions and in a gradual manner. The countries will continue to closely monitor and assess market conditions, and in their continuous efforts to support market stability, they reaffirmed the importance of adopting a cautious approach and retaining full flexibility to increase, pause or reverse the phase out of the voluntary production adjustments, including reversing the previously implemented voluntary adjustments announced in November 2023, the statement said.

The seven OPEC+ countries also noted that this measure will provide an opportunity for the participating countries to accelerate their compensation. The seven countries reiterated their collective commitment to achieve full conformity with the Declaration of Cooperation, including the additional voluntary production adjustments that will be monitored by the Joint Ministerial Monitoring Committee (JMMC). They also confirmed their intention to fully compensate for any overproduced volume since January 2024. The compensation period will be extended until the end of December 2026.

The seven OPEC+ countries will hold monthly meetings to review market conditions, conformity, and compensation. They will meet again on July 5, the statement added.

IANS