Oil production is expected to increase significantly as early as July. Opec, which is dominated by Saudi Arabia and Russia, wants to react to the end of lockdowns. The USA welcomes the step.
The oil cartel OPEC wants to increase its production in the summer much more than in the past few months.
Instead of the additional 430,000 barrels (159 liters each) that are to be pumped into the market in June, daily production in July and August is to increase by around 650,000 barrels each, the grouping announced after an online meeting on Thursday.
Opec justified its decision with the end of lockdowns in important business locations and the seasonally increased demand from refineries. According to the statement, despite the announced EU embargo on Russian oil, Russia continues to participate in the production agreements.
Within the framework of OPEC, the Vienna-based Organization of the Petroleum Exporting Countries (OPEC) cooperates with other important producing countries such as Russia. Before the alliance’s monthly meeting, two press reports had fueled speculation. The Wall Street Journal reported on a debate about temporarily excluding Russia from Opec’s production targets because of Western sanctions. The Financial Times reported that oil giant Saudi Arabia has signaled to Western countries that it will expand production if Russian production falls significantly.
After cuts during the corona pandemic
At the beginning of the corona pandemic, Opec, which is dominated by Saudi Arabia and Russia, decided on severe production cuts after pandemic measures had led to a collapse in energy demand and oil prices. In recent months, the group has gradually rolled back these cuts.
The US government responded positively to the announcement. The US welcomed the “important decision” to increase supply due to new market conditions in July and August, White House spokeswoman Karine Jean-Pierre said. “We recognize Saudi Arabia’s role as OPEC chair and its largest producer in achieving this consensus among group members.” The US wanted to continue using all available means to counter the pressure on energy prices.
