OPEC meets amid output struggles, U.S. pressure for more oil

In June, OPEC+ produced almost 3 million barrels per day less crude than foreseen by its quotas as sanctions on some members and low investment by some others crippled its ability to assuage the worlds energy crisis. Only Saudi Arabia and the UAE are believed to have some spare capacity left to increase production.

OPEC+ meets on Wednesday amid market expectations for a steady or a slight increase of oil output as most of its members are already pumping near capacity and are unable to meet U.S. calls for bigger production to help address soaring prices. The United States has put OPEC's leaders Saudi Arabia and fellow ally the United Arab Emirates under pressure to pump more oil to help with the confrontation of Russia over its invasion of Ukraine.

U.S. and Western sanctions on Russia have caused prices of all types of energy to soar, resulting in inflation rising to multi-decade highs and central banks sharply raising interest rates. OPEC has been increasing output in line with its targets by about 430,000-650,000 barrels per day a month in recent months and has refused to switch to speedier output increases.

Group sources have cited a lack of spare capacity among members to add more barrels as well as the need for further cooperation with Russia as part of the wider OPEC+ group. The meeting on Wednesday will discuss production policies from September and possibly onwards.

By September, OPEC+ would have wound down all of the record production cuts it implemented in 2020 to deal with a collapse in demand caused by the coronavirus pandemic. In June, OPEC+ produced almost 3 million barrels per day less crude than foreseen by its quotas as sanctions on some members and low investment by some others crippled its ability to assuage the worlds energy crisis.

Only Saudi Arabia and the UAE are believed to have some spare capacity left to increase production. French President Emmanuel Macron has said he had been told that Saudi Arabia and the UAE had very limited ability to increase oil production.