OPEC Plus To Ramp Up Oil Production In July, Led By Saudi Arabia.
Eight members of the OPEC Plus oil cartel, including Saudi Arabia and Russia, announced on Saturday their decision to press ahead with accelerated production increases for a third consecutive month in July. The group cited a “steady global economic outlook and current healthy market fundamentals” in a news release, confirming a planned rise of 411,000 barrels per day, though analysts suggest the actual increase may be lower.
The decision marks a significant shift in Saudi Arabia’s oil policy, the de facto leader of OPEC Plus. Previously, the kingdom had maintained uncomfortably low output levels to prop up oil prices, even as other members, such as Iraq and Kazakhstan, exceeded their agreed quotas. Saudi Arabia, set to benefit most from the increase with a new production ceiling of approximately 9.5 million barrels per day, is now signalling it will no longer restrain output if others fail to comply.
The move, widely anticipated by industry observers, reflects growing frustration among key members like Saudi Arabia and the United Arab Emirates over non-compliance within the cartel. Analysts point to the influence of US President Donald Trump, who has forged a close commercial and strategic relationship with Saudi Arabia’s de facto ruler, Mohammed bin Salman, as a key catalyst for this policy shift.
The production hike is expected to ease pressure on global oil prices, offering relief to consumers while reshaping dynamics within OPEC Plus. As the cartel navigates this bold new approach, the world will be watching to see how markets respond to the increased supply.
