OPEC+ to Increase Output Despite Production Challenges
OPEC+ is expected to approve another production increase of 188,000 barrels per day in September as part of its ongoing effort to unwind voluntary supply cuts. The decision will be made when eight key producers meet on August 2. However, actual output has been declining due to disruptions from shipping attacks and geopolitical tensions affecting export routes like the Strait of Hormuz and Bab el-Mandeb. Despite higher quotas, production in June fell below pre-war levels at 36.28 million barrels per day compared to nearly 43 million before February's conflict began. Several members face logistical challenges—Iraq struggles with bottlenecks, Kazakhstan has reduced output due to drone attacks on its pipeline infrastructure, and Russia is dealing with refinery disruptions from Ukrainian strikes. The production increases aim to signal OPEC+'s intent to restore lost barrels once export routes stabilize. Meanwhile, Brent crude rose above $100 per barrel amid renewed concerns over Houthi attacks.
Topics: geopolitical risk oil production OPEC+ supply chain disruption