Opec+ to boost oil output for third consecutive month. - Financial Times

Opec+ to boost oil output for third consecutive month. - Financial Times

OPEC+ has announced plans to increase oil production for the third consecutive month, with expectations of a potential output hike in July. The decision was made during a meeting held on Saturday, with eight OPEC+ countries accelerating their output increases, led by Saudi Arabia and Russia. This move is aimed at regaining market share and addressing over-production by allies, despite Kazakhstan's refusal to cut production [2].

The meeting, conducted online at 0900 GMT, considered a larger output increase than the scheduled 411,000 barrels per day (bpd) for July. Analysts, such as Helima Croft of RBC Capital Markets, anticipate a 411,000 bpd rise, but the potential for a larger increase cannot be ruled out [2].

OPEC+ is aiming to unwind 2.2 million bpd of voluntary output cuts by key members, a move that has been driven by the need to address market volatility and external economic pressures. Oil prices, which had dropped to a four-year low in April, have shown some recovery, closing just below $63 per barrel on Friday [2].

The decision to boost oil output comes amidst heightened uncertainty over U.S. President Donald Trump’s trade tariffs. Oil prices fell in Asian trade on Friday and were headed for a weekly loss, with uncertainty over the economic impact of Trump’s tariffs weighing on the outlook for demand [1]. The legal sparring over Trump’s tariffs has sparked renewed concerns over their economic impact, leading to losses across most risk-driven assets.

The upcoming OPEC+ decision on output is expected to have a significant impact on global oil markets. Investors and financial professionals should closely monitor the developments, as the market remains volatile and sensitive to geopolitical and economic factors [2].

References:
[1] https://finance.yahoo.com/news/oil-prices-slip-trump-tariff-034510023.html
[2] https://www.indexbox.io/blog/opec-considers-increasing-oil-output-for-july-beyond-scheduled-increments/