(Reuters) – OPEC+, the world’s largest group of oil producers, is set to announce a massive increase of 411,000 barrels per day in August, which appears to regain market share. Four representatives from the group told Reuters.
If an increase is agreed, this year will result in an increase in supply from 1.78 million bpd from OPEC+ to 1.78 million bpd. This represents more than 1.5% of global total demand. The group has not yet increased production in agreed volumes, as some members compensated for previous overproduction.
The group has fundamentally changed its policy this year after years of reduced production totaling over 5 million bpd. This was when eight members began solving the latest power cut of 2.2 million bpd from April and accelerated production hikes in May, June and July despite additional gross price supply.
The change came after some members, such as Kazakhstan, created through targets and angered others who were closely stubborn with agreed cuts. Allies, including OPEC and Russia, known as OPEC+, are trying to regain market share when rival producers such as the US boost production.
The eight-person group, including Saudi Arabia, Russia, Kuwait, Iraq, the United Arab Emirates, Kazakhstan, Oman and Algeria, will meet on July 6th.
Analysts at RBC Capital Markets’ Energy Aspects and Helima Croft are hoping for an August increase of 411,000 bpd.
“I think this group is most likely to continue with the accelerated rewind in August,” said Richard Bronze, director of Geopolitics for the Energy Side.
OPEC and Saudi Arabian authorities did not immediately respond to requests for comment.
Two sources familiar with the OPEC+ discussion, who spoke on condition of anonymity, said the group may discuss an increase of over 411,000 bpd in August, but it was not clear that all members were supporting such a move.
One complicated factor in the discussion is the possibility of more supply from Iran after the Israeli and Iran ceasefire. US President Donald Trump said Wednesday that the US did not give up the biggest pressure on Iran, but showed ease of enforcement potential to help rebuild the country.
Oil reached a five-month height of over $81 on June 23 after the US attacked Iran’s nuclear facility, but returned to $68 on Friday as a ceasefire between Israel and Iran reduced tensions and reduced supply risks. In April, OPEC+ tripled production in May, lowering $60 to under $60 as Trump’s tariffs sparked concerns about global economic debilitation.
OPEC+ pumps about half of the world’s oil. At the time of its July output decision, OPEC+8 announced or announced that production had raised a total increase of 1.37 million bpd, or 62% of a reduction of 2.2 million bpd.
The United Arab Emirates also increased its output by 300,000 bpd, bringing the total increase to 2.5 million bpd.
Reported by Alex Lawler, Olesya Astakhova, Ahmad Ghaddar and Maha El Dahan. Additional reports by Seher Dareen. Written by Alex Lawler. Edited by Simon Webb and Mark Potter
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