OPEC+: Oil cartel increases production

The oil cartel OPEC+ has agreed to increase production. The alliance agreed on Saturday to an increase of 548,000 barrels per day (bpd) for August. The Organization of the Petroleum Exporting Countries and its Allies (OPEC+) cited a stable global economic outlook and solid market fundamentals, including low oil inventories, as the reason. It was the first OPEC+ meeting since the attacks by Israel and the United States on Iran temporarily caused oil prices to skyrocket.

The production increase is being driven by eight OPEC+ members: Saudi Arabia, the United Arab Emirates, Kuwait, Oman, Iraq, Kazakhstan, Algeria, and Russia. With the agreed volume, the organization is accelerating its production increase compared to previous months. It had already increased production for May, June, and July, each ahead of schedule, by 4,110,000 bpd, even though the additional supply depressed prices. This was because some members, such as Kazakhstan and Iraq, produced more than agreed, much to the dismay of the others.

With this move, OPEC+ aims to regain market share and also respond to demands from US President Donald Trump, who is pushing for lower gasoline prices. OPEC+ produces about half of the world's oil. The group of eight OPEC+ members plans to meet again on August 3.