The OPEC+ oil group agreed Wednesday to a small increase in production despite efforts by US President Joe Biden to secure a bigger hike in talks in Saudi Arabia last month.
The group led by Saudi Arabia and Russia decided to raise production by 100,000 barrels per day for September, much lower than previous increases, according to a statement issued after a ministerial videoconference, AFP reported.
The increase, equivalent to 86 seconds of daily global oil demand, follows weeks of speculation that Biden’s trip to the Middle East and Washington’s clearance of missile defence system sales to Riyadh and the United Arab Emirates will bring more oil to the world market.
The increase of 100,000 bpd will be one of the smallest since OPEC quotas were introduced in 1982, OPEC data shows, Reuters wrote.
The Organization of the Petroleum Exporting Countries and its allies, led by Russia, a group known as OPEC+ that formed in 2017, had been increasing production by about 430,000-650,000 bpd a month, as they unwound record supply cuts introduced when pandemic lockdowns choked off demand.
They had, however, struggled to meet full targets as most members have exhausted their output potential following years of under-investment in new capacity.
Combined with disruption linked to Russia’s military operation in Ukraine in February, the lack of spare supply has driven up energy markets and spurred inflation.

Inflation will soar to “astronomical” levels over the next year forcing the Bank of England to raise interest rates higher and for longer than previously expected, according to a leading think tank.
The National Institute of Economic and Social Research also forecast a long recession that would last into next year and hit millions of the most vulnerable households, especially in the worst-off parts of the country, theguardian.com reported.
NIESR said gas price rises and the escalating cost of food would send inflation to 11% before the end of the year while the retail prices index (RPI), which is used to set rail fares and student loans repayments, is expected to hit 17.7%.
Stephen Millard, the institute’s deputy director, said the economy would contract for three consecutive quarters, shrinking the 1% by the spring of next year.
He added there will be “no respite” for British households and businesses from “astronomical inflation” in the short term and “we will need interest rates up at the 3% mark if we are to bring it down”.
As the government faces calls to step in with further support for hard-pressed families, NIESR said average incomes would fall by a record 2.5% this year, leaving millions of families to use savings or expensive credit to pay essential heating and food costs this winter.
In its half-yearly economic health check, the think tank said the number of households with no savings was set to double to 5.3 million by 2024. Families in the northeast, which rely heavily on public sector jobs, were the most likely to see their savings disappear after using them to pay for day-to-day bills.
The report painted a gloomier picture than most forecasts of the UK economy, which have tended to play down the likelihood of a long period of contraction.
Bank of England officials will give their verdict on the state of the economy today when the central bank’s monetary policy committee (MPC) will make its latest decision on interest rates and publish its quarterly review.
Most analysts have pencilled in a majority of the MPC’s nine members voting for a 0.5 percentage point increase in the bank’s base rate to 1.75%, pushing most mortgage rates to 3.5%.
Concern about the increase in the cost of living this year has become the top issue for households, according to recent polls by Ipsos Mori, and have dominated the debate between the two candidates vying for the leadership of the Conservative Party.
In May, the bank said inflation would rise slightly above 10% and fall quickly as interest rates of about 2% began to depress consumer demand.
NIESR said it expected the bank to continue hiking rates until they reached 3% and keep them in place for longer than previously expected to bring inflation down to 3% by the end of next year.
While about 80% of mortgage borrowers are on fixed rate products, millions of them will need to remortgage to higher interest rates over the next year. Higher mortgage rates also feed into private rental costs, which have already risen sharply in recent years.
The think tank said below inflation wage rises would become entrenched and by 2026 would mean that real incomes, after inflation is taken into account, would be 7% below the pre-COVID trend.

Turkey’s annual inflation rate stabilised in July at just under 80 percent, official data showed on Wednesday, helping support President Recep Tayyip Erdogan’s pledges that runaway price increases would soon stop.
The official annual rate of consumer price increases reached 79.6 percent in July compared to 78.6 percent in June, AFP reported.
Turkey plunged into a fresh economic crisis when Erdogan set off on an unusual economic experiment nearly a year ago that attempted to bring down chronically high inflation by slashing interest rates.
Conventional economic theory, accepted by world governments, states that lower interest rates drive growth and push up prices by building up demand.
Turkey now has a real interest rate that factors in inflation of negative 64.4 percent – the lowest in the world by a substantial margin.
This means that Turks have a strong incentive to spend as much as they can before their liras lose even more value.
But Erdogan has repeatedly urged “patience” and vowed that prices would start falling again at the start of next year.
The Central Bank of the Republic of Turkey now forecasts the inflation rate to ease back down to roughly 40 percent by the time Erdogan is due to face a difficult re-election next July.
Opposition leaders and many Turks no longer trust official government data.
The annual inflation rate reported this week in Istanbul – headed by a popular opposition party figure – was roughly 100 percent.
“Turkey’s official inflation and Istanbul’s inflation have historically moved in tandem,” the bank’s former chief economist Hakan Kara tweeted.
“The difference, which has reached 19.5 percentage points in the last four months, is remarkable.”
But a respected monthly study released by independent economists from Turkey’s ENAG research institute also showed prices stabilising -- although at a much higher rate than the one reported by the state statistics agency.
ENAG said the official annual rate of consumer price increases reached 176 percent in July compared to 174 percent in June.
The government’s July report showed price increases being led by a 119-percent jump in the cost of transportation.
This helps back government arguments that inflation is being driven by external factors such as soaring energy prices caused by Russia’s standoff with the West over its military operation in Ukraine.
Food prices rose by 95 percent because of the sharp depreciation of the lira that makes imports more expensive.
The Turkish currency has lost more than half its value against the dollar in the past 12 months.
It now trades at nearly 18 to the dollar compared to the 3.5 mark at which it stood in 2018.

The French government warned Wednesday that companies might have to reduce energy use this winter even with the country’s natural gas reserves at full capacity, as Russia continues to reduce its gas exports to Europe, AFP reported.
“The main players, government agencies and businesses, must reduce their consumption” of gas as well as electricity, because “the two systems are linked,” Energy Minister Agnes Pannier-Runacher told CNews television.

German exports increased for the third month in a row, data published Wednesday showed, despite fears that Europe’s largest economy could soon pitch into recession.
Germany exported 134.3b euros ($136.8b) worth of goods in June, 4.5 percent more than in May, according to seasonally adjusted figures from the Federal Statistical Office of Germany, Reuters reported.
The closely watched indicator was 18.4 percent higher than in June last year.
Germany’s trade balance remained positive at 6.4b euros, with the total value of goods imported in June sitting at 127.9b euros.
Exports to EU countries were rose by 3.9 percent from May, while those to other countries rose by 5.3 percent.
Exports to Russia increased by 14.5 percent between May and June, albeit from a relatively low base.
The export figure for June was 40.3 percent below its level in 2021 with trade collapsing after Western countries slapped tariffs on Russia for its military operation in Ukraine in February.
Despite the overall improvement, businesses have reported pessimism about the outlook for the Germany’s export-driven economy.
A survey published by the German Ifo Institute last week showed their export expectations had dropped.
The darkening business climate also suggested that Germany was “on the cusp of a recession”, said think tank president Clemens Fuest.
The German economy stagnated between April and June, registering growth of zero percent, according to official figures published last week.