Seven countries within the OPEC+ alliance, including Saudi Arabia and Russia, have agreed to increase their combined oil production quotas by 188,000 barrels per day in August. This preliminary agreement marks the fifth consecutive increase as the cartel continues to unwind production cuts introduced in recent years.
Oil prices fell on Monday following the announcement. The slide comes as crude prices return to levels not seen since before the Iran war erupted, fanning concerns about a potential glut as more supply hits the market.
The decision coincides with recovering energy flows and exports from key producers via the Strait of Hormuz. Additionally, U.S.-Iran talks to end the war have eased pressure on oil supplies, even as broader market and political volatility persists. These developments raise the prospect of further supply hitting the market if a peace pact can stick.