The OPEC+ alliance agreed to boost crude oil production by 547,000 barrels per day commencing September, accelerating the phase-out of voluntary supply cuts initially scheduled to continue until 2026, according to AP News.
This decision, ratified during Sunday’s virtual ministerial meeting, will see eight member nations—Saudi Arabia, Russia, Iraq, United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman—increase output despite looming threats of US secondary tariffs targeting Russian oil transactions.
The production adjustment arrives amidst contradictory market signals: Brent crude persists near $70 per barrel despite significant Chinese inventory builds, reflecting trader apprehension over potential Russian supply disruptions.
This unease stems directly from US President Donald Trump’s ultimatum demanding Russia reach a Ukrainian peace settlement by 7 August, after which secondary tariffs could be imposed on nations purchasing Russian hydrocarbons.
Russia’s inclusion in the production hike appears strategically significant, occurring just days before Washington’s deadline. The move enables Moscow to capitalise on elevated prices while navigating potential market turbulence.
OPEC+ emphasised the production adjustments remain contingent on evolving market conditions and may be “paused or reversed.” This cautious framing acknowledges multiple destabilising factors: Ukrainian drone attacks targeting Russian energy infrastructure, diplomatic deadlock, and concerns about sanctions’ effectiveness.
The alliance’s decision follows July’s 548,000-barrel increase and precedes their next scheduled meeting on September.
