LONDON/DUBAI, May 3 (Reuters) – Eight OPEC+ countries have agreed to an accelerated oil output hike for June, amounting to 411,000 barrels per day, according to two sources familiar with the matter. This decision was made during an online meeting that was moved forward from its original date of Monday.
Last month, these eight countries already implemented a larger-than-planned output increase for May, also by 411,000 barrels per day. This, along with U.S. trade tariffs, contributed to driving oil prices below $60 a barrel, marking a four-year low.
Oil prices dropped over 1% on Friday as traders anticipated more supply from OPEC+, amid concerns about an economic slowdown due to the U.S.-China trade war, which has led forecasters to lower demand growth expectations for this year.
Brent crude futures closed down 84 cents, or 1.4%, at $61.29 a barrel on Friday.
Saudi Arabia, the de facto leader of OPEC+, has reportedly informed allies and industry officials that it is unwilling to support oil markets with further supply cuts. Riyadh has been frustrated by Kazakhstan and Iraq producing above their OPEC+ targets.
Analyst Helima Croft of RBC Capital Markets noted that discussions seem to lean towards another three-month increase. Compliance remains a key focus, with Kazakhstan and Iraq continuing to miss their compensation targets, alongside Russia to a lesser extent.
OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, is currently cutting output by over 5 million barrels per day, with many of these cuts expected to remain in place until the end of 2026.
The group plans to hold a full ministerial meeting on May 28.
— new from Reuters