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OPEC Agrees to Modest Hike in Oil Output
Oil producers have agreed to raise their daily output of petroleum by about 1 million barrels in coming months, or about 1% of overall production.
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Oil producers have agreed to raise their daily output of petroleum by about 1 million barrels in coming months, or about 1% of overall production.
The increase will be limited to about 600,000 bpd initially. That’s because some members of the Organization of the Petroleum Exporting Countries and their allies are already pumping at full capacity.
The tentative agreement awaits acceptance by Russia and other non-OPEC participants. But when—or if—the extra output will stabilize oil prices isn’t clear.
When OPEC cut production by 1.8 million bpd in January 2016, oil futures had dropped to about $29 per barrel. Since then the price has more than doubled, causing fears that further increases would dampen demand.
OPEC ministers say increase that begin this summer will phase in gradually over many months or more, suggesting that prices won’t drop anytime soon. The price of Brent crude, the international standard, rose about $2.40 per barrel today.
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