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OPEC set to augment its daily oil output

OPEC set to augment its daily oil output
Photo by alex.ch- Ask Nigeria

OPEC has agreed to increase oil production by 100,000 barrels per day.

OPEC, the biggest producers of oil in the world are set to slightly increase the production of oil, in a bid to ease the increasing prices of oil. The Organization of Petroleum Exporting Countries (OPEC), led by Saudi Arabia and includes countries like Russia, have decided to improve their output goal by 100,000 barrels in September, a figure which is projected to be a much slower pace compared to the previous months in a period of hiked gasoline prices and an inconsistent supply of energy aggravated by the war between Russia and Ukraine.

The group, which raised its production output to 648,000 per day for June and August, is said to be considering the staggering consequence that inflation and growing COVID-19 rates may have on the overall demand for fuel in the long run. This decision comes after the United States President, Joe Biden’s visit to Saudi Arabia, which was aimed at an improved relationship, as well as persuading the group to augment its production of oil to reduce the high prices at the pump. Gasbuddy, a price comparison website reported that the average price of gasoline in the United States have fallen for 50 consecutive days.

100,000 increase, an illustration of the oil market reacting to change.

Reports further point to the fact that the administration has been working towards sourcing more barrels from other sources, due to the blatant refusal of the Saudis to committedly increase their output at the meeting. Commenting on this recent development, Jacques Rousseau, the managing director at Clearview Energy Partners averred that the United States would probably seek for other sources of oil like Venezuela or Iran. Philip Streible, the chief marketing strategist at Blue Lane Futures also stated that the situation illustrated how much the oil market is reacting to a change, noting that the 100,000 increase was a tad disappointing, as they were looking to accrue a larger output. He added that the group was probably concerned about a possible recession.

The United State’s administration has presently urged its oil and gas industry to further increase its internal production. Amos Hochstein, a senior adviser for energy security in the state’s department noted that the second quarter of most companies have recorded immense profit, admonishing that these profits should be invested into ensuring a production increase. The OPEC group had extensively decreased their production output during the pandemic, when the demand and price of oil skyrocketed. While these cuts are due for expiration by September, the group is reported to have been gradually increasing oil and gas to the market, as the world economies gradually recover from the pandemic.

Imminent persistence in high price of oil due to demand outweighing supply.

Some of the countries under OPEC like Nigeria and Angola are said to have been recording less output than agreed upon but the United Arab Emirates and Saudi Arabia reportedly have enough means to increase their production. Jacques Rousseau again asserted that this decision was aimed at an attempt to appease the countries with less production output. According to him, while immensely increasing the output target, some countries would not be able to participate due to their low output. Thus, increasing the global output by 100,000 means just little pieces from everyone.

This situation means that the demand of oil might outweigh the market supply, which means that there might be a persistent high price of oil for a while. Prior, the price of oil globally recorded an outright rise when Russia invaded Ukraine and though it fell since OPEC’s last meeting, it recorded a modest rise again on Wednesday. Russia’s global oil exports have, due to the country’s invasion of Ukraine, rejected numerous countries’ imposed sanctions. Russia have also cut off supply of gas to a host of European countries since the war began, which have driven up the prices of energy. This has also threatened these countries with an imminent recession, if they cannot pile gas to last them through the winter.

Price of gasoline still considerably high for frontline workers and families.

The recent OPEC meeting was the first, since the death of the group’s leader, Mohammed Sanusi Barkindo, last month in his home country, Nigeria. However, Haitham al-Ghais of the Kuwait Petroleum Cooperation took over as OPEC’s secretary-general this week. In the United States, a gallon of gasoline sold for $4.16 on Wednesday and though substantially lower than in June, when the price surpassed $5 for a gallon, it is still considerably high for frontline workers and families, as well as drivers who were paying 31 percent less a year ago.


Related Link

OPEC:  Website

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22 comments
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Ask Nigeria
Ask Nigeria
4 months ago

OPEC set to augment its daily oil outputOPEC has agreed to increase oil production by 100,000 barrels per day.Express your point of view.

Ask Nigeria
Ask Nigeria
4 months ago

OPEC set to augment its daily oil outputOPEC has agreed to increase oil production by 100,000 barrels per day.Express your point of view.

Abusi
Abusi
3 months ago

I hope they do as they have said. The whole world is suffering from the lower percentage of fuel that is circulating around globally as a result of the Russia – Ukraine war. Even here in Nigeria, there are alot of bunkerings going on and nobody has been held accountable yet. With the augmentation of more oil, it will alleviate some of our distress.

jdpumping
jdpumping
3 months ago

I hope.OPEC will increase their output as they are proposing because slot of countries are bearing the brunt of all these especially with the war going on between Russia and Ukraine where Russia cut it’s supply of gas to other countries and prices has skyrocket and people are paying more in order to get all these products.

Haykaylyon26
Haykaylyon26
3 months ago

It will be good if they do as they say that they will increase the output oil many countries are not receiving enough oil to sustain their country and it will lead to high price of oil is it is not enough and the war betweens the two countries make oil sector production reduce which some countries we’re receiving from them. If the output is increase from OPEC it will still improve the distribution of oil

Ultra0711
Ultra0711
3 months ago

When OPEC increases its oil supply, it will significantly improve the global economy that had been potentially harm by the war between the Ukraine and Russia and aid nations like Nigeria, where oil are currently rising. The augment will of more help and of much benefit.

Tonerol10
Tonerol10
3 months ago

Nigeria saying good things but at the end of everything we won’t see results as they always say, hope they will do as they have said

theApr
theApr
3 months ago

The augmentation of oil would be of great benefit. We just hope everything stated here would be done. The war between Russia and Ukraine has really affected lots of things

Kazeem1
Kazeem1
3 months ago

The Russian evasion on Ukraine has really dealt a major blow to the world oil sector, they should stop the invasion because it is also affecting them.

Chibuzor
Chibuzor
3 months ago

In order to bring down the high costs at the pump, it is imperative that we convince the organisation to increase the amount of oil that it produces.

DimOla
DimOla
3 months ago

We hope that this increase in crude oil by 100,000 barrel will cushion the effect of inflation and suppress this world recession that is steering at us in the face.

Remi1
Remi1
3 months ago

They should keep augmenting so that oil production will increase and be stabilized, Good one from OPEC

Last edited 3 months ago by Remi1
SarahDiv
SarahDiv
3 months ago

With OPEC willing to increase oil production by 100,000 barrel, it is believed that it will help to slow down inflation that is ravaging every part of the world.

Iyanu12345ogg
Iyanu12345ogg
3 months ago

To think of it, the proposed has numerous advantages that would be of great benefit to the country. I hope they do as they have said.

Adeolastan
Adeolastan
3 months ago

Nigeria suppose to benefit from the current increase in crude oil price but unfortunately Nigeria is in deep mess with lots of debt accrued from the shady fuel subsidy and the inability of the Nigeria to have functional refinery.

Godsewill Ifeanyi
Godsewill Ifeanyi
3 months ago

A website that compares prices, revealed that the average price of gasoline in the United States has declined for 50 days in a row, and this is terrible news for the global oil industry.

Taiwoo
Taiwoo
3 months ago

The conflict that is now taking place between Russia and Ukraine is contributing to both an increase in the cost of a gallon of gas and an unstable supply of electricity.

Nwachukwu Kingsley
Nwachukwu Kingsley
3 months ago

For convenience’s sake, the organization ought to strive toward increasing the amount of barrels it obtains from other sources.

Hassan Isa
Hassan Isa
3 months ago

The group was probably anxious about the possibility of a recession, and they should have been because there is a possibility that a recession will actually occur.

Christiana
Christiana
3 months ago

Despite greatly raising the output target, several countries would not be able to participate because of their poor productivity. Thus, an increase in global output of 100,000 means that everyone will contribute small amounts.

Tolaniiii
Tolaniiii
3 months ago

It has been reported that both Nigeria and Angola have been producing less oil than what was agreed upon, which is detrimental to the expansion of OPEC.

Bola12
Bola12
3 months ago

During the pandemic, when both demand for oil and its price shot through the roof, the Organization of the Petroleum Exporting Countries (OPEC) drastically cut their production output.

Adesanyaj72
Adesanyaj72
3 months ago

As the economies of the world slowly begin to recover from the epidemic, the OPEC group ought to be progressively increasing the amount of oil and gas that is sold on the market.