Eight OPEC+ member countries have announced a sharp increase in oil production for June, defying global market trends and risking further pressure on already low crude oil prices.
According to an official OPEC+ statement, Saudi Arabia, Russia, and six other nations will implement a production adjustment of 411,000 barrels per day, continuing the level set in May. This move contrasts sharply with the earlier plan, which targeted a modest increase of 137,000 barrels per day.
The 22-member OPEC+ alliance—comprising oil-dependent nations—had previously restricted supply to support global oil prices, holding millions of barrels in reserve to maintain market stability.
“OPEC+ has just thrown a bombshell to the oil market,” said Jorge Leon, analyst at Rystad Energy.
“Last month’s decision was a wake-up call. Today’s decision is a definitive message that the Saudi-led group is changing strategy and pursuing market share after years of cutting production,” he added.
Analysts suggest this strategic pivot may also aim to strengthen ties with the United States. Shortly after returning to office in January, President Donald Trump urged Saudi Arabia to increase oil output to ease fuel prices.
Just last month, OPEC+ slightly revised its forecast for oil demand growth, citing the adverse impact of U.S. tariffs on the global economy—a major factor for both producers and investors tracking global energy market dynamics.
A Shift in OPEC+ Strategy
Originally formed in 2016, OPEC+ was designed to amplify the influence of oil-producing nations on the global energy stage. Key players—such as Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman—had voluntarily implemented production cuts in recent years to control supply and support oil prices.
That approach has now taken a dramatic turn. Since April, the eight nations have eased restrictions, and with June’s decision, they appear ready to flood the market with more crude oil.
Internal Tensions and Global Implications
Industry experts point to several motivations behind the move. Arne Lohmann Rasmussen of Global Risk Management suggests the production boost may be a response to quota violations by some members.
Kazakhstan, in particular, has increased production without compensating for exceeding its agreed quota, noted Carsten Fritsch of Commerzbank.
Beyond internal disputes, the shift may reflect concerns about shifting geopolitical tides. While talks on Iran’s nuclear program and a Russia-Ukraine ceasefire remain stalled, the U.S. could potentially ease sanctions on both Moscow and Tehran, enabling them to re-enter the oil export market.
However, such rapid production growth poses risks. Analysts warn that it could deepen the ongoing slump in crude oil prices, currently hovering around $60 per barrel.
SEB analyst Ole Hvalbye warned that sustained prices below $55 a barrel could render U.S. oil operations unprofitable, stating that OPEC+ appears to be “testing its pricing power.”
Since President Trump’s return to the White House, oil prices have tumbled from around $80 per barrel to levels not seen since February 2021.
This price drop comes amid fears of a renewed U.S.-China trade war, potentially dampening oil demand from the world’s top two crude consumers.
