On Saturday, Saudi Arabia, Russia, and six other key OPEC+ members announced a significant increase in crude oil production for July. The group plans to produce an additional 411,000 barrels per day, matching the targets set for May and June, which is more than three times the previous planned increase, according to a statement.
In recent years, the 22-member coalition had agreed to cut daily production by 2.2 million barrels to help boost oil prices. However, early 2025 saw leading members of the group, known as the “Voluntary Eight” (V8), decide on a gradual increase in output, which has since accelerated. These moves have contributed to oil prices falling to around $60 per barrel, the lowest in four years.
U.S. President Donald Trump influenced the decision by urging Saudi Arabia to ramp up production to lower prices at the pump. The move comes after a meeting of all OPEC ministers on Wednesday, where the group reaffirmed its collective production policy. The official justification cites “healthy market fundamentals,” including oil reserves and anticipated demand growth in the coming months.
Market skepticism remains due to concerns about demand and the ongoing US-China trade tensions. Analysts suggest several motivations behind the production hike, including Saudi Arabia and others punishing members like Kazakhstan, which has not adhered to its quota under the 2022 cuts. Kazakh Energy Minister Yerlan Akkenzhenov reportedly informed OPEC that Kazakhstan will not reduce its output, further fueling tensions.
Saudi Arabia is notably upset with Kazakhstan, which is producing around 300,000 barrels per day above its quota. Despite expectations of a moderate market reaction, analysts do not foresee a sharp drop in oil prices when trading resumes Monday. As of Friday, Brent crude futures settled at $62.61 per barrel, while West Texas Intermediate was at $60.79.
