Meeting virtually on Saturday, the group — which includes heavyweight producers Saudi Arabia and Russia, as well as Algeria, Iraq, Kazakhstan, Kuwait, Oman, and the United Arab Emirates — decided to lift output by 548,000 barrels per day next month. This boost exceeds the 411,000-barrel-per-day increase that had been widely expected ahead of the meeting.
According to a statement from the OPEC Secretariat, the decision was driven by what the group sees as supportive market conditions: a “steady global economic outlook” and “healthy market fundamentals” reflected in low oil inventory levels.
Voluntary Cuts Unwinding Faster Than Planned
These eight producers have been running two layers of voluntary production cuts outside of the broader OPEC+ agreement.
One of these, amounting to 1.66 million barrels per day in cuts, will remain in place until the end of 2025. The other, a steeper 2.2 million-barrel-per-day reduction, was originally planned to last only through the first quarter of this year.
While their initial strategy was to ease the cuts gradually—adding around 137,000 barrels per day to production each month until September 2026—they accelerated that pace earlier this year.
After sticking to the planned rate only in April, the group tripled its monthly production increases to 411,000 barrels per day in May, June, and July. Now, the planned hike for August is even steeper, reflecting their confidence in stronger demand trends.
Market Factors at Play
Oil markets have seen moderate support in recent weeks. Prices got a temporary lift from the seasonal rise in summer demand and geopolitical tensions, notably the 12-day war between Israel and Iran. That conflict rattled markets due to fears of supply disruptions in the Strait of Hormuz, a critical transit chokepoint for global oil flows.
Still, prices have remained well below last year's highs. At the close of trading on Friday, Brent crude futures for September delivery settled at $68.30 per barrel on the ICE exchange, while U.S. West Texas Intermediate (WTI) futures for August closed at $66.50 per barrel on the Nymex.
The Broader Context for OPEC+
The decision underscores how OPEC+ and its leading members are balancing efforts to support prices with the need to recapture market share in the face of recovering demand.
While production curbs introduced in recent years were intended to stabilize oil prices amid pandemic-era volatility and weaker global demand, the recent uptick in consumption — especially during peak summer travel — offers these producers an opportunity to sell more oil without crashing the market.
Analysts will be watching closely to see how the additional barrels affect the supply-demand balance, especially if global economic growth holds up and inventory levels remain tight.
For now, the move suggests that the key OPEC+ producers see enough strength in the oil market to justify a faster pace of output increases, even as they keep some voluntary cuts in place to avoid oversupply risks in the longer term.