At a meeting of ministers from 13 OPEC member countries and 10 associated non-OPEC countries, the OPEC+ group decided to advance its timetable for increasing crude oil production. Output had been planned to rise by 400,000 barrels per day (bpd) in July and August, but it will now rise by 650,000 bpd in both months instead.
In a post-meeting communique, the organisation recognised how many countries had ended their coronavirus restrictions, leading to increased demand for oil:
“The Meeting noted the most recent reopening from lockdowns in major global economic centers. It further noted that global refinery intake is expected to increase after seasonal maintenance. The Meeting highlighted the importance of stable and balanced markets for both crude oil and refined products.”
The White House praised the group’s decision and commended Saudi Arabia – as well as the UAE, Iraq and Kuwait for their contributions – in managing to achieve a consensus among the 23 participating countries. The UAE and Saudi Arabia are thought to be in the best position to increase production in the short term.
Increased production from OPEC+ countries will help complement efforts from US producers like Chevron and ExxonMobil, the makers of the Texaco and Mobil lubricant ranges, in offsetting the disruption to oil supplies resulting from Russia’s invasion of Ukraine.
Despite earlier rumours that Russia would be excluded from increased production quotas, something that would allow other producers to pump more oil, this turned out not to be the case, with the increased quotas also applying to Russia.
