Eight OPEC+ Alliance Members Move Toward Output Hike At Meeting
The wider OPEC+ group -- comprising the 12-nation Organization of the Petroleum Exporting Countries (OPEC) and its allies -- began output cuts in 2022 in a bid to prop up prices.
But in a policy shift, eight alliance members spearheaded by Saudi Arabia surprised markets by announcing they would significantly raise production from May, sending oil prices plummeting.
Oil prices have been hovering around a low $65-$70 per barrel.
Representatives of Saudi Arabia, Russia, Iraq, United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman will take part in Saturday's meeting, expected to be held by video.
Analysts expect the so-called "Voluntary Eight" (V8) nations to decide on another output increase of 411,000 barrels per day (bpd) -- the same target approved for May, June and July.
The group has placed an "increased focus on regaining market shares over price stability," said Saxo Bank analyst Ole Hansen.
The group will likely justify its decision by officially referring to "low inventories and solid demand as reasons for the faster unwind of the production cuts", UBS analyst Giovanni Staunovo told AFP.
But the failure of some OPEC member countries, such as Kazakhstan and Iraq, to stick to their output quotas, is "a factor supporting the decision", he added.
By approving another output hike, heavyweight Saudi Arabia might seek to up pressure on members for not keeping to agreed quotas via slashing expected oil profits due to lower prices.
According to Jorge Leon, an analyst at Rystad Energy, an output hike of 411,000 bpd will translate into "around 250,000 or 300,000" actual barrels.
An estimate by Bloomberg showed that the alliance's production increased by only 200,000 bpd in May, despite doubling the quotas.
Analysts expect no major effect on current oil prices, as another output hike is widely anticipated.
The meeting comes after a 12-day conflict between Iran and Israel, which briefly sent prices above $80 a barrel amid concerns over a possible closing of the strategic Strait of Hormuz, a chokepoint for about one-fifth of the world's oil supply.
As fears of a wider Middle East conflict have eased, and given there "were no supply disruptions so far", the war is "unlikely to impact the decision" of the alliance, Staunovo added.
The Israel-Iran conflict "if anything supports a continued rapid production increase in the unlikely event Iran's ability to produce and export get disrupted," Hansen told AFP.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
DW
an hour ago
- DW
DW's Limbourg: "Israel must ensure safety of journalists"
On July 4, a DW correspondent from the DW office in Jerusalem and a DW cameraman were pelted with large stones and chased by Israeli settlers north of Ramallah, during an attack on the village of Sinjil. They managed to reach safety without physical injuries, but the cameraman's car was severely damaged: a window was shattered and the bodywork was dented. DW Director General Peter Limbourg: "DW condemns this attack on our colleagues who had traveled to Sinjil to cover a planned protest against settler violence. We are relieved that they were not physically injured in the attack and were able to get to safety. There is no justification for this attack. We strongly demand that the Israeli government guarantee the safety of all journalists in the West Bank. Freedom of the press – and therefore the safety of journalists – is an indispensable pillar of any democracy." Sinjil is located in the Palestinian-administered part of the West Bank. Other journalists, mainly Palestinians, also had to flee. In addition to DW, other international media were on location to report, including AFP, the New York Times and the Washington Post. The DW employees wore press vests and were therefore clearly recognizable as media professionals.
DW
an hour ago
- DW
DW's Limbourg: "Israel must ensure safety of journalists"
On July 4, a DW correspondent from the DW office in Jerusalem and a DW cameraman were pelted with large stones and chased by Israeli settlers north of Ramallah, during an attack on the village of Sinjil. They managed to reach safety without physical injuries, but the cameraman's car was severely damaged: a window was shattered and the bodywork was dented. DW Director General Peter Limbourg: "DW condemns this attack on our colleagues who had traveled to Sinjil to cover a planned protest against settler violence. We are relieved that they were not physically injured in the attack and were able to get to safety. There is no justification for this attack. We strongly demand that the Israeli government guarantee the safety of all journalists in the West Bank. Freedom of the press – and therefore the safety of journalists – is an indispensable pillar of any democracy." Sinjil is located in the Palestinian-administered part of the West Bank. Other journalists, mainly Palestinians, also had to flee. In addition to DW, other international media were on location to report, including AFP, the New York Times and the Washington Post. The DW employees wore press vests and were therefore clearly recognizable as media professionals.
DW
2 hours ago
- DW
Australia: PM denounces synagogue arson attack – DW – 07/05/2025
A man doused the door of the building in Melbourne and set it alight while 20 worshippers were inside. Australia's Prime Minister Anthony Albanese on Saturday labeled as "cowardly" an arson attack on a Melbourne synagogue. Police are searching for a man who set the front door of the building ablaze on Friday night as around 20 people ate dinner inside. Australia is facing a growing wave of antisemitic incidents since the Israel-Gaza war started in late 2023. In a statement, the prime minister said: "Last night's arson attack on the synagogue in east Melbourne is cowardly, is an act of violence and antisemitism, and has no place in Australian society." Albanese said he hoped the perpetrator would be swiftly brought to justice and "that he faces the full force of the law, and anyone involved in this attack faces the full force of the law." Police said a man doused the double front doors of the downtown East Melbourne Hebrew Congregation and set it alight around 8 p.m. on Friday night. The worshippers, who were sharing a meal to mark the Shabbat Jewish day of rest, evacuated through a rear door and no one was injured, the police statement continued. Firefighters extinguished the blaze, which was contained to the front entrance, police added. Victoria state police said they were investigating the "intent and ideology" of the perpetrator. Police said they believed the perpetrator was a white male, aged in his 30s. Authorities said they were probing if the attack was linked to an incident on Friday night at an inner-city restaurant in which one person was arrested for hindering police. The Israeli restaurant was extensively damaged, according to reports. Acting Victoria Police Commander Zorka Dunstan described the synagogue attack as a serious crime. "I'd like to make it very clear that we do recognize that these crimes are disgusting and abhorrent. But at this stage, we are not declaring this a terrorist incident," Dunstan told reporters. A terrorism declaration opens the investigation to more resourcing and can result in charges that carry longer prison sentences. Jewish neighborhoods in Melbourne and Sydney have been hit by a wave of antisemitic vandalism since the Israel-Gaza war began on October 7, 2023. Homes, schools, synagogues and vehicles have been targeted. The incidents have included a fake plan set up by organized crime to attack a Sydney synagogue using a caravan of explosives to divert police resources, authorities said in March. Last December, two masked men struck the Adass Israel Synagogue in Melbourne's southeast, causing extensive damage by spreading a liquid accelerant with brooms throughout the building before igniting it. A worshipper sustained minor burns.
