OPEC+ is expected to proceed with its plan to increase oil output for the second consecutive month in May, according to sources familiar with the matter. As oil prices remain steady, the group aims to implement measures to encourage some members to cut back on production to make up for previous overproduction. OPEC+, which consists of OPEC and allied producers led by Russia, controls over 40% of the world’s oil supply and is set to raise output by 135,000 barrels per day in May.
This increase marks the second monthly rise following a broader initiative to gradually unwind the extensive production cuts that have been in place since 2022. The group is working on balancing the targets for members who have adhered to previous commitments while also urging others who have exceeded their quotas to reduce their output temporarily. Recently, it was announced that seven members would implement additional monthly reductions through June 2026 to compensate for earlier overproduction.
These compensation cuts are intended to facilitate the continuation of the monthly output hikes. Sources indicate that the scheduled increases are expected to remain in place starting in May. However, all sources requested anonymity due to the delicate nature of the discussions, and responses from OPEC along with authorities from Saudi Arabia and Russia have not been provided yet.
On the market front, Brent crude was trading above $72 a barrel, recovering from a dip to approximately $68 earlier this month. Analysts, such as Amrita Sen from Energy Aspects, believe that the unwinding of production cuts is feasible due to low crude inventories, the approaching summer demand surge, and efforts to enhance compliance among the group members. An OPEC+ ministerial committee, which can recommend production policy changes, is set to convene on April 5.