01.07.2025 15:28

OPEC+ is poised to boost oil production yet again, according to a report from Commerzbank. Several sources, including Reuters and Bloomberg, cite delegates from the organization as indicating a likely production increase of 411,000 barrels per day in August. This decision is expected to be finalized during a meeting scheduled for next weekend.

Commerzbank's commodity analyst, Carsten Fritsch, points out that this development isn't entirely unexpected. He highlights that Kazakhstan, a member of the OPEC+ alliance, failed to meet its previously agreed-upon production targets in June; instead, they seemingly surpassed them. Furthermore, Russia, which initially expressed hesitancy regarding a significant production increase last month, now appears to support this latest proposal.

Adding further credence to the projected increase, President Putin recently acknowledged the surge in summer oil demand, suggesting a larger supply boost is feasible. This sentiment is echoed by Deputy Prime Minister Novak, who will represent Russia at the upcoming July 6th meeting and anticipates discussions surrounding further production volume increases.

This planned increase, representing the fourth such boost since April, would cumulatively add nearly 1.8 million barrels per day to global oil supply. However, Commerzbank cautions that this influx of oil could lead to a substantial market surplus once summer's peak demand wanes. Consequently, oil prices face a potential downturn following the summer months. This potential oversupply presents a significant risk to the stability of oil prices in the near future.