Sources in “OPEC +” indicate that the bloc will commit to a modest increase in production next July, while this represents a rejection of Western demands to increase production.
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“OPEC +” will commit to a modest increase in production in July
Sources in “OPEC +” said that “the bloc is expected to abide by the oil production agreement approved last year during its meeting on the second of June, with an increase in production targets in July, by 432,000 barrels per day,” while this represents a rejection of calls. Western countries for faster increases in production in order to curb high prices.
Under an agreement reached in July last year, the Organization of the Petroleum Exporting Countries and its allies gradually reduced record production cuts by increasing by about 400,000 barrels per day each month.
Western countries, facing record inflation rates that threaten economic growth, have repeatedly asked the group to speed up their production increases. However, group members stress that the oil market is balanced and that the recent price increases are not related to fundamentals.
It is expected that production cuts will stop completely by the end of next September, but the production of the oil conglomerate has actually been declining sharply due to sanctions and the reluctance of buyers, which negatively affected Russian production, as well as Nigeria and Angola pumping oil volumes less than the target.
And internal data revealed that “OPEC +” produced 2.6 million barrels of oil per day, less than the target in April.
Oil prices have risen as much as 5% since the beginning of May, largely due to expectations that the European Union will agree to ban Russian oil imports. While Russia has sharply increased oil sales to China and India, the complications associated with sales to European buyers have increased.