OPEC+ in a recent meeting has decided to raise oil output by 400,000 barrels per day (bpd) each month from August to help fuel a global economic recovery as the pandemic eases.
Earlier in July, negotiations of OPEC+ members on easing production cuts became deadlocked due to a row between the world’s largest oil exporter Saudi Arabia and neighbour the United Arab Emirates.
Since May, the 23-member grouping, which also includes Russia, had raised oil output bit by bit, after slashing it more than a year ago when the coronavirus pandemic crushed demand.
The aim is to return to pre-pandemic production levels, with the alliance still pumping 5.8 million bpd less than it was before the pandemic.
In a rare challenge to OPEC leader Saudi Arabia, the UAE rejected the proposed deal earlier this month as “unjust”, leading to a stalemate.
But in a compromise, Sunday’s discussions agreed to adjust output quotas next May for the UAE, Iraq, Kuwait, Russia and Saudi Arabia itself, meaning their actual cuts will be less.
Saudi Energy Minister Prince Abdulaziz bin Salman, who chairs the OPEC group, declined to say how the new quotas were decided and beneficiaries chosen, saying it had been part of “consensus building”.