VIENNA, July 6 — Seven of the largest producers within the OPEC+ alliance agreed on Sunday to raise their combined crude output ceiling by 188,000 barrels per day starting in August, extending a phased unwinding of long-standing voluntary cuts and taking their cumulative quota expansion since April to roughly 940,000 barrels per day.
The group — Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman — reached the decision during an online ministerial meeting held on Sunday, and the Organization of the Petroleum Exporting Countries confirmed the outcome in a statement issued after the videoconference. It marks the fifth consecutive monthly quota increase announced by the seven-country subgroup and continues a policy path first sketched in March, when the producers agreed to gradually restore barrels that had been kept off the market since 2023 under a series of additional voluntary reductions.
Under the individual allocations disclosed by delegates for the core producers, Saudi Arabia and Russia will each add 62,000 barrels per day in August, Iraq will add 26,000, Kuwait 16,000, Kazakhstan 10,000, Algeria 6,000 and Oman 5,000. The alliance said its Joint Ministerial Monitoring Committee (JMMC) will continue to oversee compliance, and it reiterated that any country producing above its quota since the start of 2024 must submit and execute a compensation schedule to offset those excess barrels.
The Sunday statement said the producers remained ready to “pause or reverse” the ongoing quota restoration should market conditions warrant, language that has appeared unchanged in each of the group’s monthly communiqués this year. The next ministerial review is scheduled for August 2, and delegates said the meeting would once again assess demand indicators, tanker throughput data and each country’s compliance with its assigned production ceiling.
The decision landed against a backdrop in which physical crude flows through the Strait of Hormuz — the narrow waterway that in a normal year carries roughly a fifth of the world’s oil consumption — have begun returning after months of severe disruption. Traffic through the strait was heavily curtailed during the recent conflict between the United States, Israel and Iran, forcing Gulf producers to hold back barrels even as their nominal quotas continued to rise. According to figures published by OPEC’s secretariat, combined output across the wider group fell to about 33.13 million barrels per day in May, down from roughly 42.77 million barrels per day in February, before recovering partially in June as export corridors were re-established.
For most of the second quarter, the quota increases agreed by the seven producers therefore existed largely on paper. Saudi Arabia, Kuwait and Iraq had been the countries most exposed to the shipping shutdown, and none was in a position to raise loadings while insurance and routing risks remained elevated. That constraint has now eased. Tanker-tracking services cited by international news agencies indicate that Saudi Arabia and the United Arab Emirates have restored crude flows through Hormuz to pre-conflict volumes, although both countries’ wellhead output remains below normal, with the current export recovery drawing heavily on inventories accumulated during the disruption.
Prices have moved in step with the improving supply picture. Brent crude settled near $72 a barrel on Friday, back to the range that prevailed before the strikes on Iranian nuclear and military sites, and well below the peak above $120 a barrel reached at the height of the conflict. Coordinated releases from the strategic reserves of member states of the International Energy Agency, softer refined-product demand in several large importing economies, and rising output from producers outside the Middle East have all contributed to the pullback. Investment banks now expect Brent to move within a lower range for the remainder of the year, with some forecasts pointing to prices around $60 a barrel by the fourth quarter if the current pace of quota restoration continues.
Analysts described Sunday’s decision as broadly in line with expectations. Giovanni Staunovo, a commodities strategist at UBS, said the seven-country group had continued to gradually undo cuts, as widely anticipated by the market, and that near-term attention would centre on how many tankers can transit Hormuz on a sustained basis and how quickly demand and crude imports recover in Asia and Europe. Independent estimates cited by delegates suggest that the seven producers still hold roughly 379,000 barrels per day of unused voluntary reductions after the August increase. If a similar-sized rise is approved for September at the August meeting, the entire tranche of additional voluntary cuts introduced in 2023 would be fully rolled back, effectively closing that chapter of the group’s supply management.
The OPEC+ alliance itself is undergoing a period of internal recalibration. The United Arab Emirates formally left both OPEC and the wider OPEC+ configuration on May 1, ending a long-running dispute over baseline production levels the country said no longer reflected its expanded capacity. Its exit reduced OPEC’s membership from twelve to eleven and removed one of the eight countries that had steered monthly quota decisions since 2023. Iraq, another founding OPEC member, has meanwhile publicly signalled that it wants a higher long-term ceiling, arguing that its current allocation understates the size of its production base. Delegates said the compensation and re-baselining discussions triggered by these positions are expected to intensify in the second half of the year.
For consuming economies, the immediate effect of the August adjustment is likely to be modest. Even without the paper barrels added on Sunday, the market has been rebalancing as Gulf shipping normalises, and the group’s own data suggest that actual output continues to lag quota by a wide margin. Refiners in Asia have already reported cargoes arriving faster than local demand can absorb, and floating storage levels along key trade routes have climbed. Whether the alliance can hold its members to a coordinated pricing stance as more barrels return will be the central test at the August meeting, and it will shape the outlook for global energy prices well into the autumn.
