By Yinka Kolawole, with agency report
The Organisation of Petroleum Exporting Countries and its allies, known as OPEC+, are planning to continue a gradual increase in oil production quotas with a target of fully restoring a 1.65 million barrels-per-day output cut introduced in 2023 by September this year.
According to a Bloomberg report yesterday, the alliance has already agreed to reinstate nearly two-thirds of the production cuts and is expected to implement three additional monthly quota increases in the coming months.
The phased supply restoration comes amid persistent geopolitical tensions in the Middle East, particularly the ongoing Iran-related conflict, which has continued to disrupt exports through critical supply routes, including the Strait of Hormuz. Despite the planned quota increases, actual production growth across the alliance has remained limited, as several member countries face operational challenges, infrastructure limitations and supply disruptions linked to the regional conflict.
Delegates quoted in the report said OPEC+, led by Saudi Arabia and Russia, intends to proceed with the scheduled quota adjustments even though the increases may remain largely symbolic in practical terms.
The group had initially implemented the 1.65 million barrels-per-day production cut in 2023 as part of efforts to stabilise global crude oil prices amid concerns over weakening demand and excess supply in the international market.
Before tensions escalated in the Middle East, eight major OPEC+ producers had begun a gradual reversal of the output restraint agreement.
However, the effectiveness of the production restoration programme has been affected by disruptions in some producing nations and changing dynamics within the alliance. The United Arab Emirates’ recent exit from OPEC has also reduced the effective scale of the original production cut arrangement.
At its May 3 meeting, OPEC+ approved a modest production increase of 188,000 barrels per day for June, signalling the group’s cautious approach to returning supply to the market. The alliance is expected to review July production levels and broader supply policy at its next ministerial meeting scheduled for June 7.
Analysts say OPEC+ faces the delicate task of balancing efforts to stabilise oil prices while responding to supply uncertainties and geopolitical risks that continue to shape the global energy market.
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