Members of OPEC+ have announced plans to increase oil production as global energy markets show tentative signs of recovery following recent geopolitical tensions linked to the US–Israel war on Iran.
The group said on Sunday that seven key producers—Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman—will raise output by 188,000 barrels per day from August. The decision was made after a virtual meeting to review global market conditions and outlook.
This marks the fifth consecutive monthly production increase by the same group of countries, continuing a gradual rollback of the production cuts introduced in 2023.
OPEC+ originally implemented coordinated output reductions in April and November 2023 amid volatility in global financial markets, including banking sector instability that triggered a sell-off in oil and other commodities.
In its statement, the organisation said it would continue to closely monitor market conditions, stressing the need for a cautious approach while maintaining flexibility to increase, pause, or reverse production adjustments as needed. The group also confirmed it will meet again on August 2 to reassess the situation.
Oil prices, which briefly surged above $126 per barrel in April, have since retreated to pre-conflict levels. Analysts attribute the decline to easing geopolitical tensions and expectations of improved shipping stability in the Strait of Hormuz.
Shipping traffic through the strategic waterway has gradually increased following a June 17 memorandum of understanding between U.S. President Donald Trump and Iranian President Masoud Pezeshkian aimed at de-escalating the conflict. However, traffic levels remain significantly below normal, with daily transits far short of pre-war averages.
Market observers say continued developments in the region will remain a key factor influencing oil price stability in the coming weeks.
