The group has agreed to open the taps to cool rising energy prices
© Getty Images / baona
The Organization of the Petroleum Exporting Countries and allies, known as OPEC+, agreed on Thursday to increase oil production to offset Russian output losses and ease soaring prices.
According to a press release published on its website, the group will hike output by 648,000 barrels per day (bpd), or 0.7% of global demand, over the months of July and August.
The initial plan said the group would add 432,000 barrels per day every month until the end of September.
The move will likely be seen as a sign of willingness by Saudi Arabia and other OPEC Gulf nations to pump more after months of pressure from the West to address global energy shortages worsened by sanctions on Russia.
According to industry estimates, the growing economic pressure could reduce production from Russia, the world’s second largest oil exporter, by as much as 2 million to 3 million bpd. The country was already producing below its OPEC+ target of 10.44 million bpd in April, with output running at around 9.3 million bpd.
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Reuters analysts say the real production boost will be insignificant, as most OPEC members except for Saudi Arabia and the United Arab Emirates were already pumping at capacity.
Oil prices rose despite the output hike decision, with benchmark Brent trading at $118 a barrel and the US WTI headed towards $117 at 16:00 GMT. Earlier this year, crude soared to the highest price since 2008, hitting $147 per barrel.
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