OPEC+ plans oil quota hikes through September

Leading OPEC+ members plan to continue monthly oil quota hikes through September to complete the restoration of production cuts implemented in 2023, delegates told Bloomberg.

The move comes as major producers remain unable to translate those increases into actual supply growth because the war with Iran continues to block exports from the Persian Gulf.

The group has formally agreed to restore around two-thirds of the 1.65 million barrels per day production cut introduced in 2023. Current plans call for recovering the remaining volumes in three additional monthly stages, although the effective delivery of those increases remains constrained by the ongoing conflict.

The alliance, led by Saudi Arabia and Russia, has proceeded with modest supply increases during the war. Global markets face an urgent need for additional oil to offset a supply shortfall exceeding 1 billion barrels caused by the conflict, which has depleted global inventories and pushed fuel prices higher, raising concerns about a possible recession.

Eight key members of the Organization of the Petroleum Exporting Countries and their partners had been restoring crude production that was curtailed years earlier to address an oversupplied market before the conflict between the U.S.-Israeli alliance and Iran began on Feb. 28.

The United Arab Emirates withdrew from OPEC this month after decades of membership following disagreements with Saudi Arabia over production limits. The departure reduced the group’s membership by one country.

The remaining seven members approved a production increase of 188,000 barrels per day for June during their May 3 videoconference. The next meeting to review the July production policy is scheduled for June 7.

The UAE’s exit removes around 144,000 barrels per day from the original 1.65 million bpd production cut agreement.