For September, OPEC+ is set to boost production by 100,000 barrels per day, providing a tight market with additional supply at a far slower rate than in previous months.
However, the world consumes more than 88 million barrels of oil per day. That means 100,000 barrels a day would make up only 0.1% of the world’s oil demand. Some analysts have criticized the increase as a slight against President Joe Biden.
In July, Biden traveled to Saudi Arabia in an effort to encourage the two top producers of oil in the world — Saudi Arabia and the United Arab Emirates — to increase production in order to assist control oil prices that had been driven up by rising demand and Moscow’s invasion of Ukraine.
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“That is so little as to be meaningless. From a physical standpoint, it is a marginal blip. As a political gesture it is almost insulting,” said Raad Alkadiri, managing director for energy, climate, and sustainability at Eurasia Group.
The increase is one of the smallest in OPEC+ history, and western capitals are likely to be disappointed.
It is unlikely that the little increase in production will significantly reduce prices. As word from the conference emerged, Brent crude, the global benchmark, increased 0.73% to $101.29 per barrel.
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Image and article originally from www.benzinga.com. Read the original article here.