OPEC+ has agreed to raise production targets for August, adding further supply to a global oil market already struggling under falling crude prices.
The group approved an increase of 188,000 barrels per day for August during an online meeting, following similar increases already implemented for June and July.
Seven core members of the alliance have collectively hiked output quotas by nearly 800,000 barrels per day across the April through July period alone.
Those seven producers — Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman — are unwinding a 1.65 million barrel-per-day supply cut that was originally agreed in 2023.
Brent crude prices were trading near $72 per barrel on Friday, a steep drop from recent peaks above $120 per barrel.
That price level puts crude back roughly where it traded just before the United States and Israel launched strikes on Iran on February 28.
Despite ongoing supply disruptions, oil prices have retreated to pre-war levels, pressured by weaker Chinese import demand and stronger output from producers outside the Middle East.
A record release of global strategic reserves, coordinated by the International Energy Agency, has added additional downward pressure on prices across international markets.
Much of the OPEC+ output increase has remained largely on paper, as the U.S.-Israeli war on Iran effectively closed the Strait of Hormuz to tanker traffic for several key member nations.
Saudi Arabia, Kuwait, and Iraq were among the OPEC+ members most affected by the Strait of Hormuz closure, limiting their ability to physically raise exports.
The group also faces mounting internal tensions, with the United Arab Emirates having exited the alliance and Iraq signaling a desire for higher individual production quotas going forward.
OPEC+ must now balance its strategy of gradually restoring supply against a market backdrop that is showing little appetite to absorb additional barrels at current price levels.
