The OPEC+ oil group has announced that they will increase the oil production by 547,000 barrels per day starting in September. This is part of a series of monthly increases that began in April. It is worth noting that the same group had reduced production by 2.2 million barrels a day in 2023 to reduce supply and support oil prices.
Countries increasing oil production
The member countries that are boosting the oil production include Russia, Iraq, Saudi Arabia, the UAE, Kazakhstan, Kuwait, Algeria, and Oman. They had earlier agreed to cut their output voluntarily in November 2023. These cuts were supposed to last until September 2026. But with this new decision, they will end earlier than what was originally planned.
Putin vs Trump: Opec+ announcement comes amid tariff threat
The announcement comes at a time when US President Donald Trump has already warned of new sanctions on countries amid tariff threats that keep buying oil from Russia.
Trump has set a deadline of August 8 for Vladimir Putin to end the war in Ukraine. If that doesn’t happen, he plans to impose more sanctions and taxes on countries that buy oil from Russia. There is no doubt that India, which is the second-largest buyer of Russian oil, is being closely watched.
After OPEC+ announcement, how will India gain?
Indian officials have already said that the country’s oil refineries will keep buying oil from Russia, even as the US prepares to impose new sanctions this week on countries that continue trading with Moscow during the Ukraine war, the Guardian reported.
Some media reports last week claimed that India, a major energy importer, was planning to stop buying low-cost Russian oil. Trump responded by saying that if true, it would be a positive move.
He also mentioned hearing that India had stopped buying oil from Russia, but wasn’t sure if the information was accurate.
Indian government sources, however, denied this, telling news agency ANI that it has not stopped importing Russian oil. They said such decisions are based on price, oil type, storage levels, transport, and other business factors.
Trump had commented a day after the White House announced a 25% tariff on all Indian goods, along with penalties for countries that continue buying weapons and energy from Russia during the conflict.
Now that OPEC+ countries have announced more production of oil, India is expected to benefit as it continues to buy oil from Russia. However, since Trump has threatened to put stricter tariffs on countries buying oil from Russia, India may also take another hit. The tax has already been confirmed, but the details of the penalty are not yet clear. Also, the EU ban, starting in January 2026, may force Indian refiners to carefully separate the type of oil they buy. At the same time, the US threats could lead to extra sanctions that might affect the shipping, insurance, and money systems that make India’s Russian oil trade possible.