New Delhi, Aug 2 (IANS) The OPEC+ on Sunday approved another increase in its crude production quota by around 188,000 barrels per day from September, which restores the earlier production cuts that were rolled out by the oil cartel in 2023.
The decision to increase production was taken by the seven key OPEC+ producers, including Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman.
However, the decision may not have an immediate impact on global oil supplies as the Middle East conflict continues to disrupt oil and gas exports as the Strait of Hormuz, through which 20 per cent of the world’s oil and gas exports transit, remains choked. Consequently, higher production quotas do not automatically translate into more oil reaching global buyers.
Higher official quotas also do not necessarily mean that producers can actually deliver the additional crude. Russia is facing pressure on its oil industry after repeated Ukrainian drone attacks striking deep into Russian territory to hit energy infrastructure. The country’s production is currently around 9 million barrels per day, below its OPEC+ target of about 9.8 million barrels per day.
The UAE’s exit from the OPEC+ group in May has added another layer of uncertainty. Its departure followed years of frustration over production cuts and has raised questions about how much longer OPEC+ members will remain willing to accept coordinated limits.
Analysts expect the group to take a more cautious approach after the September increase.
Rystad Energy expects OPEC+ to hold production levels steady during the fourth quarter before discussions begin around quotas for 2027. That could give producers time to assess the impact of restored exports, global demand, and oil prices before deciding whether to release more crude.
The group has already raised production targets several times since 2025 after years of restricting supply. Between late 2022 and 2023, OPEC+ introduced three rounds of cuts that reduced its combined output by nearly 6 million barrels per day.
The strategy later shifted towards gradually bringing those barrels back to the market.
Meanwhile, President Donald Trump says he has cancelled US strikes against Iran, provided a deal is struck “rapidly” with the country.
The US President said on Truth Social that he had been asked by Iran and other countries in the Middle East to hold off on any attack as the perimeters of a deal had been agreed.
Trump’s comments came amid reports that the US and Israel may have plans to intensify attacks against Iran.
However, Iran’s Mehr news agency denied that Tehran had asked the US to hold off on further military action, saying Trump’s claims were “nothing but a new lie”.
–IANS
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