Overview
- A seven-member subgroup of OPEC+ — Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman — approved a 188,000 barrels-per-day quota increase for July, the decision announced on Sunday, June 7.
- The approved rise is the fourth consecutive modest increase and brings the group’s planned reversals of 2023 voluntary cuts to roughly 800,000 bpd on paper since April.
- Supply on the water and at terminals remains sharply reduced, with OPEC reporting alliance output fell from about 43 mbd in February to 33.2 mbd in April and the IEA estimating roughly 14 mbd are currently off the market because of transport and logistics limits.
- The United Arab Emirates formally left OPEC on May 1 and has said it will raise output outside the quota system, a move that removes a key source of spare capacity and weakens the alliance’s ability to deliver coordinated supply increases.
- Market watchers say prices are likely to stay elevated because Gulf spare capacity cannot be fully exported while the Strait of Hormuz stays closed, so the next key signals will be any change in UAE shipments, the resumption of Hormuz flows, or a larger coordinated policy shift by OPEC+.