A fresh round of internal tensions is emerging within OPEC+, as several member nations are preparing to advocate for quicker oil production increases. Sources familiar with the matter say these calls will be voiced in June, marking a second consecutive month of potential accelerated output adjustments.
Unexpected Output Surge Fuels Friction
In April, OPEC+ took markets by surprise by raising oil production by 411,000 barrels per day—three times the group’s initial target. This move, coupled with ongoing geopolitical uncertainty and the U.S.-China trade standoff, has dragged oil prices to four-year lows.
Now, some members want to maintain this aggressive stance and repeat the May increase volume. An official decision is expected on May 5 when eight member countries reconvene to finalize the June output strategy.
Saudi Frustration Grows Over Non-Compliance
Saudi Arabia, a key influencer within OPEC+, has been particularly vocal about countries exceeding their quotas, especially Kazakhstan and Iraq. The kingdom pushed for the May output hike after these nations were found producing well above their assigned limits.
Despite the push for discipline, Kazakhstan remains firm in its stance. The country’s energy minister told Reuters it won’t curtail the production of independent oil majors operating within its borders. “Kazakhstan’s statement cements our view that OPEC+ may implement another accelerated three-month unwind again in the May meeting and it may continue again in July and through the summer,” noted Amrita Sen, co-founder of Energy Aspects.
Output and Compliance Data Show Mixed Signals
Although Kazakh oil production dropped by 3% in the first half of April compared to March, it still exceeded the agreed quota. Iraq, the group’s biggest overproducer, pledged to reduce output but has instead upped its exports in April, according to tracking data from Kpler.
This discrepancy has deepened the rift within OPEC+ as the group attempts to maintain unity while also managing supply and demand effectively.
Calls for Caution Among Key Players
While some nations are eager to fast-track the wind-down of voluntary cuts, others remain cautious. Russia, for example, prefers the previously agreed incremental monthly increases of 135,000 barrels per day to avoid destabilizing prices. This conservative approach is shared by a few other members within the coalition.
The divergent strategies stem from external pressures as well. President Trump has urged OPEC to lower oil prices and reinvigorated his “maximum pressure” policy on Iran, aiming to restrict the country’s oil exports entirely. His upcoming visit to Saudi Arabia adds another layer of political complexity to the energy landscape.
Ongoing Cuts and Future Plans
The planned increases in May and potentially June are part of a broader strategy involving Russia, Saudi Arabia, the UAE, Kuwait, Iraq, Algeria, Kazakhstan, and Oman to unwind a recent output cut of 2.2 million barrels per day. Additionally, OPEC+ still has 3.65 million barrels per day of cuts in place, set to run through the end of next year in a bid to support global oil prices.
As the summer approaches, the direction OPEC+ chooses could significantly shape oil markets, especially if internal divisions continue to deepen.