Eight member nations of the OPEC+ alliance are likely to meet on Saturday to deliberate on a potential further acceleration of oil production increases for the month of June, Reuters reported, citing two sources.
This meeting will determine whether these key producers will opt for a more substantial output hike than initially anticipated or adhere to the previously agreed-upon, smaller increase.
The decision hinges on a variety of factors, including current global oil demand, prevailing market prices, and geopolitical considerations.
The outcome of Saturday’s discussions will likely have a significant impact on global oil supply and prices in the coming weeks.
The meeting, initially planned for Monday, was moved to an earlier date. The reason for this change was not immediately apparent.
Increase in oil output from May
In April 2025, amidst concerns over global oil demand and economic stability, Saudi Arabia advocated for a substantial increase in crude oil production from the eight participating member nations of a prominent oil-producing alliance for May.
This proposal for a more significant output surge than initially anticipated was ultimately implemented.
The resulting increase in the global oil supply exerted downward pressure on crude oil prices, causing them to plummet below the $60 per barrel mark.
This price level represented the lowest valuation for oil in a period of four years, signifying a considerable shift in the energy market landscape and potentially impacting the economic outlook of oil-dependent nations and industries worldwide.
The eight members of the OPEC+ alliance, including Saudi Arabia and Russia, were responsible for voluntary production cuts of 2.2 million barrels per day since early 2024.
In April, the voluntary production expired as the eight members unwound some of it by raising output by 135,000 barrels per day.
However, the group last month stated that it will increase output by a further 411,000 barrels per day in May. The market was expecting the cartel to increase output by similar levels to April.
Kazakhstan conundrum
Sources indicated Riyadh’s displeasure with Kazakhstan and Iraq for exceeding their OPEC+ production quotas.
Oil prices dipped below $60 per barrel this week, partly due to a Reuters report indicating that Saudi officials have communicated to allies and analysts their willingness to accept sustained lower oil prices.
Reports had earlier indicated that the group may go ahead with an accelerated increase in oil production for June as well.
The oil-producing alliance known as OPEC+, which comprises the Organization of the Petroleum Exporting Countries and its allies, notably Russia, is presently implementing production cuts exceeding 5 million barrels per day.
A full OPEC ministerial meeting is scheduled by the group for May 28.
“Given the ongoing downside pressure on global demand growth, Saudi’s comments seem unlikely to put an end to the downtrend in oil prices,” said David Morrison, senior market analyst at Trade Nation.
But it is worth remembering that at some stage the market will run out of willing sellers. Then there will be rally, irrespective of the underlying fundamentals.
At the time of writing, the price of Brent crude oil on the Intercontinental Exchange was at $61.37 a barrel, down 1.2% from the previous close.
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