OPEC Plus, the group of oil-producing countries, announced on Saturday that they will increase oil production by about 411,000 barrels per day in June. This decision comes despite falling oil prices and economists cutting their forecasts for global economic growth. The group stated that the oil market is “healthy” and noted that oil inventories remain low.
Saudi Arabia, the leader of OPEC Plus, is reluctant to hold back millions of barrels of oil that it could produce, especially when other members of the group, like Kazakhstan and Iraq, are not following their agreed-upon production limits. Richard Bronze, the head of geopolitics at Energy Aspects, a research firm in London, said, “The view from Saudi Arabia, in particular, is that they no longer want to be the ones carrying the heaviest burden if other countries in the group are not showing sufficient commitment to doing their part.”
Demand for oil has not weakened significantly. The International Energy Agency in Paris reported that oil consumption increased by 1.2 million barrels per day in the first quarter of 2025, the most since 2023.
OPEC Plus to increase June output
However, analysts are reducing their forecasts for demand because they expect disruption from global trade tensions, which have already affected prices. The decision by OPEC Plus to increase oil production in June follows a similar decision at their April meeting.
This represents a significant change in policy that will impact the wider energy industry, affecting the profits of oil companies and leading to cutbacks. The move by OPEC Plus comes at a time when the global economy is facing challenges. Economists are lowering their predictions for global economic growth, and there are concerns about the impact of trade tensions on the world economy.
Despite these challenges, OPEC Plus appears to be focused on maintaining a stable oil market and ensuring that there is enough supply to meet demand. The group’s decision to increase production in June suggests that they believe the market can absorb the additional supply without causing prices to fall further.
