OPEC+ nations agreed on Aug. 2 to raise oil output by 188,000 barrels/day starting in September, the sixth consecutive monthly increase. While the increase is minimal, consequences of the ongoing closure of the Strait of Hormuz and Ukrainian strikes on Russian oil infrastructure have undoubtedly increased the pressure on the oil market to adjust.
The increase continues a slow retracement of the deep production restraint OPEC+ has maintained since the alliance’s formation in 2016, when Saudi Arabia and Russia first coordinated cuts to defend prices after the 2014–16 price crash. OPEC+ was then producing some 30 million bpd out of 85 million.
Those initial cuts became deep declines under the impact of the COVID pandemic, so that by the end of 2021, OPEC+ production was nearly 8 million bpd lower than in 2015, according to records of the U.S. Energy Information Administration (EIA).
