Opec agrees to accelerate oil production following US pressure

Opec agrees to accelerate oil production following US pressure

Opec and its allies on Thursday agreed to accelerate oil production in July and August, as the cartel’s linchpin Saudi Arabia bowed to US pressure to cool a crude price rally that has threatened to stall the global economy.

The cartel said it would increase output by almost 650,000 barrels a day in both months, up from planned increases of around 400,000 b/d.

The move came just days after the EU agreed to impose a ban on Russian oil imports, deepening fears of global energy shortages as Moscow’s invasion of Ukraine continues to rattle markets.

Saudi Arabia and the United Arab Emirates, Opec’s two powerhouse producers, are likely to account for most of the supply increases, with Riyadh earlier signalling that it was prepared to increase output to overcome Russian shortages.

The extra supplies are the first time the Saudi-led Opec+ cartel has deviated from a measured supply policy agreed in the depths of the pandemic oil crash two years ago, and comes after months of high-level US diplomacy to repair relations between Riyadh and Washington.

A senior administration official said the US “welcomed Opec and Saudi Arabia’s decision, which was the right move at the right time”.

The Opec decision comes just weeks ahead of