OPEC+ oil-producing countries will likely agree on a further hike in their output target for July when they meet on Sunday, three sources said, though the Iran war has so far prevented several from delivering previous increases.
Another quota increase would show the group is approaching business as usual despite the disruption caused by the Strait of Hormuz closure and the unexpected exit in May of the United Arab Emirates, a member of the Organization of the Petroleum Exporting Countries for almost 60 years.
Seven core members of OPEC+, which groups OPEC and allied producers including Russia, have increased their output quotas from April to June by almost 600,000 barrels per day.
In reality, the group's production has collapsed due to export cuts by Gulf members, averaging 33.19 million bpd in April versus 42.77 million in February, according to OPEC figures.
The monthly target set by the seven is expected to increase by about 188,000 bpd for July, the sources said. This is the same as the hike agreed for June, which was adjusted down from 206,000 bpd to take into account the UAE exit.
All sources spoke on condition of anonymity and said a final decision had not been made. OPEC, Saudi, and Russian officials did not immediately reply to Reuters requests for comment.
The seven OPEC+ countries are increasing production as part of the gradual unwinding of a 1.65 million bpd production cut that the then eight members agreed in 2023.
From July, the seven will have about 567,000 bpd of the original cut to return to the market, taking into account the UAE exit from May 1, according to Reuters calculations.
That would mean the rest of the cut will be unwound by the end of September should OPEC+ stick to monthly hikes of about 188,000 bpd for August and September.
OPEC delegates are in Vienna on Monday and Tuesday this week for technical meetings and presentations. Sunday's ministerial meetings are expected to be online.
Seven of 21 OPEC+ members due to meet on Sunday are Saudi Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia, and Oman.
Two other OPEC+ ministerial meetings also scheduled for June 7 are not expected to make any policy changes, the sources said.
