World News
Eight OPEC+ Members to Raise Oil Output Again in July
Eight OPEC+ countries have agreed to continue oil production increases with a 411,000 bpd adjustment for July.
Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman, who had previously implemented voluntary cuts beyond OPEC+ targets, confirmed the move during a virtual meeting on Saturday, according to an OPEC statement.
The group has cited a steady global economic outlook and healthy market fundamentals, including low inventories, as key reasons to maintain the pace of supply restoration.
The planned unwinding of 2.2 million bpd in voluntary cuts began with a reported 138,000 bpd increase in April. That increment rose to 411,000 bpd in May and has been maintained for June and now July.
This has put downward pressure on Brent crude, which has come down from levels of $73/bbl in April to close to $64/bbl now.
"It's the third month in a row that the group has raised output more than its original agreement of 138kb/d, Daniel Hynes, senior commodity strategist at ANZ Bank, said in his LinkedIn post on Monday.
"The move should also help OPEC recover market share lost to the US oil shale producers, who are not considering paring back drilling activity and output amid the low prices."
Hynes expects the market to soften further in the coming months, despite the start of the driving season in the northern hemisphere.
The eight countries will meet again on 6 July to decide August production levels.
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