OPEC+ agreed on Sunday a fourth increase in its oil output targets in as many months, even though the US war with Iran is still preventing several of the group's members from pumping more.
The war has cut oil flows via the Strait of Hormuz, creating the world's biggest-ever supply crisis as key OPEC+ members including Saudi Arabia have been unable to supply customers in full since the end of February.
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 compared with 42.77 million in February, according to OPEC figures.
On Sunday, the seven members decided to increase targets by 188,000 bpd from July, OPEC said in a statement.
This is the same as the June hike, which was adjusted down from monthly increases of 206,000 bpd in May and April to take into account the United Arab Emirates’ exit. The UAE left OPEC after almost 60 years.
On Friday, oil prices fell to around $93 a barrel as traders gained confidence that renewed conflict between the US and Iran was growing less likely. Prices were close to $72 before the war began.
The seven countries are increasing production as part of the gradual unwinding of a 1.65 million bpd production cut that the group, which at the time included UAE, agreed in 2023.
The seven of 21 OPEC+ members who met on Sunday are Saudi Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia, and Oman. In recent years, only the seven plus the UAE when it was a member have been involved in the group's output policy decisions.
