OPEC+ has agreed to increase its oil output by roughly 50%, a significant uptick that comes in the face of intense pressure from the U.S. and others to ramp up output amid Russia’s war against Ukraine that has exacerbated global energy prices.
The increase will amount to more than 200,000 extra barrels of oil per day for July and August, going from 432,000 to 648,000 barrels per day.
The decision by the international oil cartel, led by Saudi Arabia and including Russia, drew praise from the White House.
“We recognize the role of Saudi Arabia as the chair of OPEC+ and its largest producer in achieving this consensus amongst the group members. We also recognize efforts and positive contributions of UAE, Kuwait and Iraq,” White House press secretary Karine Jean-Pierre said in a statement. “The United States will continue to use all tools at our disposal to address energy prices pressures.”
Oil markets had fallen slightly before the announcement Thursday morning but quickly rebounded into positive territory following the news.
OPEC+ has been slow to increase its output, even as global demand spiked as countries came out of pandemic lockdowns and Russia invaded Ukraine. The war has prompted the U.S. to ban oil imports from Moscow.
Europe has agreed to largely phase out Russian oil by year’s end, putting further strain on other oil-producing nations to fill the void left by supplies from the foreign adversary.