OPEC to hike oil production by 188,000 barrels per day
Brent falls below $84 as US-Iran diplomacy lifts supply hopes
The decision to increase production was taken by the seven key OPEC+ producers, including Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman.
New Delhi: The OPEC+ has decided to increase 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.
