OPEC+ Boosts Oil Output Again Despite Price Drop and Demand Concerns

OPEC+ has agreed to increase oil production for a second consecutive month, raising output by 411,000 barrels per day in June, signaling continued efforts to unwind earlier cuts. The decision, made during a brief online meeting, comes despite Brent crude prices falling below $60 in April for the first time in four years and rising concerns over weaker global demand due to economic headwinds and U.S. trade tensions.

The producer alliance, led by Saudi Arabia and including Russia, stated that oil market fundamentals remain healthy and inventories are low. The June hike adds to the increases in April and May, bringing the total to 960,000 bpd—about 44% of the group’s previously agreed 2.2 million bpd cut. The phased unwinding began in April, with eight key OPEC+ members boosting supply by around 138,000 bpd monthly.

Saudi Arabia is reportedly pushing for faster output hikes to penalize Iraq and Kazakhstan over poor compliance with quotas. Kazakhstan, notably, exceeded its April quota and has openly prioritized national interests over group targets. Russia has also fallen slightly short of its commitments.

The latest decision follows pressure from U.S. President Joe Biden to raise production, with his visit to Saudi Arabia scheduled later this month. Analysts, including UBS’s Giovanni Staunovo, expect oil prices to fall further on Monday due to the increased supply and ongoing economic concerns.

Despite the production hikes, OPEC+ is still cutting nearly 5 million bpd in total, with many of those curbs extending through 2026. A full ministerial meeting is scheduled for May 28 to reassess output strategy amid shifting market dynamics and compliance challenges.