Oil Market Stabilization: OPEC Increases Production Again

OPEC increased its oil production last month. The price per barrel is again approaching the stable level of two years ago, and the countries are discussing the further lifting of restrictions on the oil extraction.

Plans to meet growing demand and revive the oil industry saw production hit its highest level in a year. In June, production was increased by 855,000 barrels per day to 26.47 million barrels. At the same time, slightly more than half of the increase is accounted for by the leader of the group - Saudi Arabia.

As global fuel consumption recovers in the US, Europe and parts of Asia, the alliance and its partners are gradually ramping up production. However, OPEC's next step has yet to be determined. Negotiations to increase shipments after August ended on Thursday. The reason for this was the disagreement on the part of the United Arab Emirates regarding the production quota allocated to the state. OPEC plans to complete negotiations next week.

All but one of the 13 OPEC members managed to increase supplies last month. Saudi Arabia, which accounted for a large share of the cuts during the pandemic, increased production by 490,000 barrels per day to 8.95 million barrels. This is supposed to help the country cope with the economic crisis. Oil production was increased, including by Iran, which is under sanctions, and Venezuela, which is struggling with the industrial crisis.

OPEC+, which includes non-core countries such as Russia, is currently considering commissioning most of its oil production capacity. Taking into account the fact that the price of Brent is closest to the maximum over the past two years, an increase in oil production is real.