OPEC+ to hike oil production in July, prioritizing market share

Eight OPEC+ countries, including Saudi Arabia, Russia, Iraq, and the UAE, agreed on Saturday to increase oil production by 411,000 barrels per day (bpd) in July, continuing their strategy to reclaim market share and enforce compliance among members.

The decision follows the group's earlier plan to gradually unwind 2.2 million bpd of voluntary cuts starting April 2025. The latest adjustment marks the third consecutive monthly hike, bringing the total increase since April to 1.37 million bpd — 62 percent of the planned return.

The group cited "steady global economic outlook and healthy market fundamentals", including low oil inventories, as justification for the increase. However, analysts warn the move could further pressure prices, which recently hit four-year lows below $60 per barrel in April.

"Today's decision only goes to show that market share is on top of the agenda. If price will not get you the revenues you want, they are hoping that volume will," said analyst Harry Tchilinguirian of Onyx Capital Group. 

OPEC+ pumps about half of the world's oil and includes OPEC members and allies, such as Russia.

Its increased supply is weighing on crude prices, squeezing all producers, but some more than others, including a key group of rivals - US shale producers, analysts say.

US shale producers have seen costs rise in the past three years. Their income is also falling due to declining global oil prices - linked in part due to the economic fallout from the US tariffs policies.

Shale producers now need a price of $65 per barrel on average to profitably drill, according to a first-quarter Dallas Federal Reserve survey of over 100 oil and gas companies in the Texas, New Mexico and Louisiana region.

(With input from Reuters)