OPEC+ Countries Agree to Boost Oil Production: What to Know
Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content.
Members of the Organization of Petroleum Exporting Countries (OPEC+) on Sunday announced plans to increase oil production by over half a million barrels per day for September as concerns over supply disruptions persist.
The eight members of OPEC+ held a virtual meeting in response to U.S. pressure on some nations—such as India—to halt all Russian oil purchases in an additional move aimed at pressuring Moscow to end its ongoing conflict in Ukraine.
However, OPEC+ said it would increase output due to a healthy economy and low oil inventory, with oil prices remaining at a higher level even as output has increased from members.
Newsweek reached out to the White House and Department of Energy (DOE) by email on Sunday outside of normal business hours for comment.
Why It Matters
President Donald Trump in last year's presidential campaign promised to tackle a number of major targets, including an end to the Russia-Ukraine war and lowering prices for Americans amid high inflation.
Russian President Vladimir Putin's resistance to diplomatic efforts has frustrated Trump and forced the U.S. to seek more creative means to try and achieve an end to the war that began in February 2022.
What To Know
The U.S. has looked at imposing tariffs on Russia and convincing countries that still purchase Russian oil to switch to other sources. Some feared that these actions could drive up gas prices for Americans, as well.
However, those fears appear to have been averted as OPEC+ agreed to increase production, providing a healthy alternative to Russian oil. OPEC+ includes Saudi Arabia, Russia, Iraq, United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman. It remains unclear how this could impact Russia's other sales and negotiations.
OPEC+ has made voluntary production cuts since November 2023, with plans to phase those cuts out by September 2026, but the announcement means that the countries will increase output for the second time this year—following July's announcement of a similar increase in August—and effectively ending the program early.
Prices have remained at the higher rate of around $70 a barrel for Brent crude despite the increased output, however, raising some doubts as to what impact the increased output might have on gas prices.
An Austrian soldier stands outside of the building headquarters of OPEC (Organization of The Petroleum Exporting Countries) in Vienna, Austria on May 28.
An Austrian soldier stands outside of the building headquarters of OPEC (Organization of The Petroleum Exporting Countries) in Vienna, Austria on May 28.
Joe Klamar/AFP via Getty Images
What People Are Saying
President Donald Trump last week wrote on Truth Social, in part: "We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the United States will work together on developing their massive Oil Reserves. We are in the process of choosing the Oil Company that will lead this Partnership. Who knows, maybe they'll be selling Oil to India some day!"
Mark Temnycky, a nonresident fellow at the Atlantic Council think tank's Eurasia Center, previously told Newsweek: "If the U.S. follows with new restrictions or tariffs, Americans could see higher energy prices, especially at the gas pump and in sectors tied closely to fuel, like transportation and manufacturing."
He added: "These cost increases may filter down to everyday goods as companies adjust for rising input expenses. In addition, inflation will be a concern for many American consumers and policymakers."
What Happens Next?
The members will meet again in September for further discussions and adjustments to production.
This article includes reporting by the Associated Press.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
24 minutes ago
- Yahoo
Exclusive-Tesla's brand loyalty collapsed after Musk backed Trump, data shows
By Chris Kirkham LOS ANGELES, August 4 (Reuters) -Tesla for years had more repeat U.S. customers than any other major automotive brand but its loyalty has plunged since CEO Elon Musk endorsed President Donald Trump last summer, according to data from research firm S&P Global Mobility shared exclusively with Reuters. The data, which has not been previously reported, shows Tesla's customer loyalty peaked in June 2024, when 73% of Tesla-owning households in the market for a new car bought another Tesla, according to an S&P analysis of vehicle-registration data in all 50 states. That industry-leading brand loyalty rate started to nosedive in July, that data showed, when Musk endorsed Trump following an assassination attempt in Pennsylvania on the Republican nominee. The rate bottomed out at 49.9% last March, just below the industry average, after Musk launched Trump's budget-slashing Department of Government Efficiency in January and started firing thousands of government workers. Tesla's U.S. loyalty rate has since ticked back up to 57.4% in May, the most recent month the S&P data is available, putting it back above the industry average and about the same as Toyota but behind Chevrolet and Ford. S&P analyst Tom Libby called it "unprecedented" to see the runaway leader in customer loyalty fall so quickly to industry-average levels. "I've never seen this rapid of a decline in such a short period of time," he said. Tesla and Musk did not respond to requests for comment. The timing of Tesla's plunging brand loyalty suggests the CEO's involvement in politics turned off customers in the EV pioneer's eco-conscious customer base, some analysts said. "If they have Democratic leanings, then perhaps they consider other brands in addition to Tesla," said Seth Goldstein, an analyst at Morningstar. Tesla's aging model lineup also faces stiffer competition from an array of EVs from legacy automakers including General Motors, Hyundai and BMW. The only new model Tesla has released since 2020, its triangular Cybertruck, has proved a flop despite Musk's prediction of hundreds of thousands of annual sales. On an April earnings call, Tesla CFO Vaibhav Taneja singled out "the negative impact of vandalism and unwarranted hostility towards our brand and people," but also said there were "several weeks of lost production" when the company retooled factories to produce a refreshed version of its top-selling Model Y. Musk on the April call said that "absent macro issues, we don't see any reduction in demand." Tesla vehicle sales overall are falling globally and have declined 8% in the United States the first five months of 2025, according to S&P. Sales fell 33% over the first six months of the year in Europe, where public backlash to Musk's politicking has been particularly fierce. Musk's increased political activism was "very bad timing" for Tesla, said Garrett Nelson, an analyst who tracks the EV maker at CFRA Research, because it came exactly as the company faced heightened competition from Chinese EV makers and other traditional automakers. He said his top concerns for Tesla are its loss of market share and "what can be done to repair the brand damage." LOYALTY NOSEDIVE Tesla remains the U.S. electric-vehicle sales leader but has seen its dominance erode as Musk last year delved into politics and focused Tesla more on developing self-driving technology than on new affordable models for human drivers. Customer loyalty is a closely watched auto-industry metric because it is 'much more expensive' to take new customers from competitors than to retain existing ones, said S&P's Libby. S&P offers some of the most detailed industry data on automotive purchases because it analyzes vehicle registration data from all 50 states on a household-by-household basis. Unlike survey data, it follows actual vehicle transactions to track how consumers migrate among brands and models. From the fourth quarter of 2021 through the third quarter of last year, more than 60% of Tesla-owning households bought another one for their next car purchase, the data show. Only one other brand – Ford – posted a quarterly loyalty rate exceeding 60% during the period, and only once. CUSTOMER DEFECTIONS S&P's data also examines another aspect of the automotive market: Which brands and models are taking customers away from others, and which ones are losing them? Until recently, Tesla was in a different stratosphere than other automotive brands on this metric. For the four years prior to July 2024, Tesla, on average, acquired nearly five new households for every one it lost to another brand. No other brand from a major automaker was even close: Hyundai's luxury Genesis brand was the next best, acquiring on average 2.8 households for every one it lost, followed by Kia and Hyundai, which acquired on average 1.5 and 1.4 households, respectively, for every one they lost. Ford, Toyota and Honda lost more households on average than they gained during that period. Tesla's average inflow of customers started to decline in July 2024 along with its loyalty rate. Since February, Tesla has been gaining fewer than two households for every one it loses to the rest of the industry, its lowest level ever, according to the data. 'The data shows clearly that the net migration to Tesla is slowing,' Libby said. Brands that now attract more Tesla customers than they lose to Tesla include Rivian, Polestar, Porsche and Cadillac, the data show. Brian Mulberry, client portfolio manager at Tesla investor Zacks Investment Management, said he isn't concerned about Tesla's long-term earnings because he expects enormous profits from its plans to operate robotaxis and license self-driving technology to other automakers. Tesla launched a small test of robotaxis in Austin in June, giving rides to hand-picked fans and Internet personalities but the service isn't available to the general public. If Tesla succeeds in expanding the technology, Mulberry said, 'there's a case to be made that Tesla doesn't need to sell cars and trucks anymore.' Sign in to access your portfolio
Yahoo
24 minutes ago
- Yahoo
Canada's economy is showing 'resilience' against U.S. tariffs. Why?
OTTAWA — "Some resilience" — those were the two words Bank of Canada governor Tiff Macklem used last week to describe how the Canadian economy is holding up under the weight of U.S. tariffs. Just a few days later, U.S. President Donald Trump added 35 per cent tariffs on Canadian goods to a running tally that includes hefty duties on steel, aluminum, automobiles and, more recently, semi-finished copper. With tariffs piling up over the past few months, economists say Canada's economy is starting to show cracks — but few signs of collapse. TD Bank economist Marc Ercolao conceded it's a "bit of surprise" to see the economy holding up against a massive disruption from Canada's largest trading partner. "Many months ago, ourselves — as well as other economic forecasters — had an outlook for a much weaker Canadian economy. Obviously, that isn't manifesting now," he said in an interview. "We are avoiding the worst-case scenario." What are tariffs doing to the economy? On Thursday, Statistics Canada gave a glimpse at how the economy wrapped up the second quarter of the year when many of those tariffs came into full effect. While the agency sees a couple of small contractions in real gross domestic product by industry in April and May, its flash estimates show the economy rebounding somewhat in June. If those early readings pan out, StatCan said that would be good enough for flat growth overall on the quarter. Some of those results are distorted by volatility — businesses rushing to get ahead of tariffs boosted activity in the first quarter, and that's giving way to weakness in the second quarter, for example. It's still hard to pinpoint exact impacts tied to tariffs, Ercolao said, but a broad trend is emerging. "What we can say over the last six months or so is that economic activity is somewhat flatlining," he said. Services sectors are holding up relatively well, but Ercolao said export-heavy industries such as manufacturing and transportation are bearing the brunt of the impact. In an attempt to shore up some of that weakness, the federal government has announced various programs to support tariff-affected workers and broader plans to accelerate defence and infrastructure spending. Macklem noted during his press conference Wednesday that business and consumer confidence are still low, but have improved according to the central bank's recent surveys. And while some trade-exposed sectors have faced job losses and the unemployment has generally trended upward to nearly seven per cent, employers elsewhere in the economy continue to expand their payrolls. "Consumption is still growing," Macklem said. "It's growing modestly. It's certainly being restrained by the uncertainty caused by tariffs. But it is growing and we expect that to continue through the third and fourth quarters." Will Canada hit a recession? Last week the Bank of Canada kept its policy interest rate unchanged at 2.75 per cent in a third consecutive decision. If the central bank were panicked about the Canadian economy's ability to withstand U.S. tariffs, Ercolao argued it would likely have lowered that rate. The past week's GDP readings were good enough for BMO to raise its outlook for the third quarter into positive territory. Forecasters at the bank now expect Canada will avoid a technical recession this year. BMO chief economist Doug Porter said in a note to clients Friday that Ottawa's personal tax cut at the start of the month and robust demand for domestic travel amid the trade war will boost the economy this quarter, as will "the less-dire sentiment" around economic forecasts. Some other forecasters continue to pencil a tariff-induced recession into their outlooks. In the Bank of Canada's monetary policy report released alongside the rate decision, it outlined one scenario for the economy assuming the tariff situation remains largely status quo. Canada avoids a recession in that outcome. Growth in 2025 and 2026 remains overall positive, but half a percentage point lower than it would've been without the weight of tariffs. Macklem told reporters that the Bank of Canada would expect the economy to keep growing even with today's tariffs in place, "but it'll be on a permanently lower path." "Unfortunately, the sad reality is that tariffs mean the economy is going to work less efficiently," he said. What about the new tariffs? Porter said in his note that the actual impact of Trump's new 35 per cent tariff on Canada's economy could be less than headline figure suggests. Because of a carve-out for Canadian exports that are compliant with CUSMA, BMO sees the effective U.S. tariff rate at roughly seven per cent under the new duties, less than a percentage point higher than where it stood before Friday. But with CUSMA up for renegotiation in 2026, Porter said that 35 per cent tariff rate could loom as a "cudgel" over negotiations — taking full effect if the trade agreement expires without a new deal in place. The Bank of Canada published a separate "escalation" scenario this week that would see the United States remove Canada's CUSMA exemption as it ramps up global tariffs. Real GDP would drop an extra 1.25 per cent by 2027 in this more severe case; Porter said that this outcome would be "serious for sure, but far from disastrous." Ercolao said much of the tariff doom-and-gloom earlier in the year was tied to the speed at which those import duties would be imposed. But the on-again, off-again nature of U.S. trade restrictions to date has given businesses time to adapt to the new way of doing business and constant delays in implementation, he said. "If we go back to when Trump began his presidency, had he went 100 per cent on his tariff plan right away, we probably would have seen a deep economic contraction just because it would have been so sudden," Ercolao explained. "Now we've been afforded that time to at least try to mitigate some of the negative impacts from what these tariffs were expected to do to the Canadian economy." This report by The Canadian Press was first published Aug. 4, 2025. Craig Lord, The Canadian Press Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
24 minutes ago
- Yahoo
Explainer-What happens next in the US court battle over Trump's tariffs?
By Jan Wolfe and Dietrich Knauth WASHINGTON (Reuters) -A federal appeals panel on Thursday appeared skeptical of U.S. President Donald Trump's argument that a 1977 law historically used for sanctioning enemies or freezing their assets gave him the power to impose tariffs. Regardless of how the court rules, the litigation is almost certainly headed to the U.S. Supreme Court. Here is what you need to know about the dispute, which Trump has called "America's big case," and how it is likely to play out in the months ahead. WHAT IS THE CASE ABOUT? The litigation challenges the tariffs Trump imposed on a broad range of U.S. trading partners in April, as well as tariffs imposed in February against China, Canada and Mexico. It centers around Trump's use of the International Emergency Economic Powers Act (IEEPA), which gives the president the power to address "unusual and extraordinary" threats during national emergencies. Trump has said that trade imbalances, declining manufacturing power and the cross-border flow of drugs justified the tariffs under IEEPA. A dozen Democratic-led states and five small U.S. businesses challenging the tariffs argue that IEEPA does not cover tariffs and that the U.S. Constitution grants Congress, not the president, authority over tariffs and other taxes. A loss for Trump would also undermine the latest round of sweeping tariffs on dozens of countries that he unveiled late Thursday. Trump has made tariffs a cornerstone of his economic plan, arguing they will promote domestic manufacturing and substitute for income taxes. WHAT'S THE STATUS OF THE LITIGATION? The U.S. Court of Appeals for the Federal Circuit heard oral arguments on Thursday in the case. The panel of 11 judges sharply questioned the government about Trump's use of IEEPA, but did not rule from the bench. The Federal Circuit has not said when it will issue a decision, but its briefing schedule suggests it intends to move quickly. Meanwhile, the tariffs remain in effect after the Federal Circuit paused a lower court's ruling declaring them illegal. WILL TRUMP'S TARIFFS BE BLOCKED IF HE LOSES IN COURT? A Federal Circuit ruling would almost certainly not end the litigation, as the losing party is expected to appeal to the Supreme Court. If the Federal Circuit rules against Trump, the court could put its own ruling on hold while the government appeals to the Supreme Court. This approach would maintain the status quo and allow the nine justices to consider the matter more thoroughly. The justices themselves could also issue an "administrative stay" that would temporarily pause the Federal Circuit's decision while it considers a request from the Justice Department for more permanent relief. IS THE SUPREME COURT LIKELY TO STEP IN? The Supreme Court is not obligated to review every case appealed to it, but it is widely expected to weigh in on Trump's tariffs because of the weighty constitutional questions at the heart of the case. If the Federal Circuit rules in the coming weeks, there is still time for the Supreme Court to add the case to its regular docket for the 2025-2026 term, which begins on October 6. The Supreme Court could rule before the end of the year, but that would require it to move quickly. HOW MIGHT THE SUPREME COURT RULE? There is no consensus among court-watchers about what the Supreme Court will do. Critics of Trump's tariffs are optimistic their side will win. They point to the Supreme Court's decision from 2023 that blocked President Joe Biden from forgiving student loan debt. In that ruling, the justices limited the authority of the executive branch to take action on issues of "vast economic and political significance" except where Congress has explicitly authorized the action. The justices in other cases, however, have endorsed a broad view of presidential power, especially when it comes to foreign affairs. CAN IMPORTERS SEEK REFUNDS FOR TARIFFS PAID? If Trump loses at the Supreme Court, importers are likely to seek refunds of tariffs already paid. This would be a lengthy process given the large number of anticipated claims. Federal regulations dictate that such requests would be first heard by U.S. Customs and Border Protection. If that agency denies a refund request, the importer can appeal to the Court of International Trade. There is precedent for tariff refund requests being granted. Since May, CBP has been processing refunds to importers who inadvertently overpaid duties because of tariff "stacking" — where multiple overlapping tariffs are applied to the same imports. And in the 1990s, after the Court of International Trade struck down a tax on exporters that was being used to finance improvements to U.S. harbors, the court set up a process for issuing refunds. That decision was upheld by both the Federal Circuit and the Supreme Court. WOULD A COURTROOM DEFEAT UNRAVEL TRUMP'S TRADE DEALS? Trump has used the threat of emergency tariffs as leverage to secure concessions from trading partners. A loss at the Supreme Court would hamstring Trump in future negotiations. The White House, however, has other ways of imposing tariffs, like a 1962 law that allows the president to investigate imports that threaten national security. Trump has already used that law to put tariffs on steel and aluminum imports, and those levies are not at issue in the case before the Federal Circuit. Some legal experts say a loss for Trump at the Supreme Court would not impact bilateral trade agreements the U.S. has already inked with other countries. Others say that the trade deals alone might not provide sufficient legal authority for taxes on imports and may need to be approved by Congress. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
