OPEC

European benchmarks began the week with gains. Oil and gold prices increased, but the euro weakened against the dollar. Sentiment was influenced by OPEC+’s decision to pause production hikes in the first quarter of next year, which led to a modest rise in oil prices as fears of oversupply eased. Gains were, however, mostly lost by late morning.

The international benchmark, Brent crude futures, traded at $64.76, while US West Texas Intermediate cost $60.92 a barrel.

Alongside pauses in the new year, OPEC+ countries agreed on Sunday to increase output by a small 137,000 barrels per day in December, maintaining the pace set for October and November.

Meanwhile, investors expect fresh Western sanctions on Russia, targeting Rosneft and Lukoil, to hinder the country’s ability to boost production further.

At the same time, major Western oil companies are benefitting from the disrupted supply of Russian refined fuels due to attacks and sanctions. Refining margins have risen substantially, giving the oil majors a boost. Both BP and Shell share prices were slightly up on Monday before noon in Europe.

“The decision by producers’ cartel OPEC+ to pause further output hikes at the start of next year, amid concerns about a glut of supply, helped give oil prices a lift and, in turn, boosted UK market heavyweights BP and Shell,” said AJ Bell investment director Russ Mould.

The movements also came as BP announced it had agreed to divest stakes in US shale assets to Sixth Street investment firm on Monday.

Winners in Europe

At 11:00 CET, the UK’s FTSE 100 was up by a few points. The DAX in Frankfurt was leading the gains, up 0.8% after an initial stutter. The CAC 40 in Paris started climbing, reaching gains of nearly 0.2%. The lift in France came despite national budget uncertainties and the release of negative PMI data, which showed that the country’s manufacturing sector was still contracting in October.

US futures were positive around the same time, rising between 0.1% and 0.5%.

Meanwhile, the earnings season continues. A number of European companies are reporting this week, including AstraZeneca, BP, BMW, and Commerzbank.

Ryanair opened the week by posting stronger-than-expected results for the first half of its financial year, spanning April to September. Revenues rose 13% to €9.82bn, as traffic grew 3% and fares increased by 13%. Over the same period, profit rose by 42% year-on-year to €2.54bn, driven by a strong Easter season.

The airline’s shares were up 2.90% in Dublin at around midday.

Looking ahead, Ryanair’s outspoken CEO Michael O’Leary criticised countries in Europe where airlines face high taxes, including environmental duties. In an interview with CNBC, he threatened to move capacity outside the UK should the new budget include such a levy.

“Ryanair is also one of several airline operators with an eagle eye on taxes and costs. It is no longer putting up with unfavourable tax systems, preferring to switch flights and routes to less punitive locations,” Mould commented.

In other markets, the euro weakened against the US dollar by more than 0.2%, hitting a rate of $1.1517 by 11:00 CET. At the same time, the Japanese yen and the British pound were also losing ground against the greenback, with the dollar trading at ¥154.15 and the pound costing $1.3136.

Gold traded just above $4,000, rising slightly by 0.3%.

Sept. 7 (UPI) — A coalition of major oil-producing nations said Sunday it will slightly scale back its voluntary production cuts starting in October, adding a small amount of crude back into global markets while keeping most of its reductions in place.

Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman, which have made extra voluntary cuts since 2023, met virtually Sunday to review global market conditions and agreed to reduce those curbs by about 137,000 barrels a day, the Organization of the Petroleum Exporting Countries announced in a news release.

Decisions by OPEC+, which includes nonmember producers like Russia, matter for everyday Americans because the group controls more than 40% of global oil output and helps set the price of crude oil, the main ingredient in gasoline. Even small shifts in production can ripple through global markets, affecting what drivers pay at the pump, the costs of shipping and air travel, and broader inflation that touches everything from groceries to utilities.

If the scale-back of cuts succeeds in balancing supply with demand, oil prices may stabilize or even ease slightly, giving consumers modest relief at the pump and helping to cool inflation pressures. But if markets weaken or inventories climb unexpectedly, OPEC+ could reverse course, pausing or restoring the cuts, which could tighten supply and push prices back up.

The move is a fraction of the 1.65 million barrels per day the group pledged to withhold from the market in April 2023, when concerns about slowing demand and oversupply were pressing prices downward.

In November 2023, the alliance introduced an additional 2.2 million barrels per day in voluntary cuts. The April 2023 cuts were meant to be extended through 2025, and the November 2023 cuts were scheduled to phase out gradually through September 2025, although both could be modified based on market developments.

Officials said the adjustment reflects what they described as a steady global economic outlook and “healthy” market fundamentals, pointing to low oil inventories as evidence that supply and demand remain balanced. They emphasized that the cuts can be restored gradually, in part or in full, if conditions shift.

Analysts cautioned that the actual increase in oil supply may be far smaller than the headline figures suggest. Only Saudi Arabia and possibly the United Arab Emirates have enough spare capacity to raise output significantly, while most other members are already pumping near their limits, according to the Financial Times.

As a result, the real boost to global supply in October could be closer to 60,000 barrels a day, people familiar with the discussions told the newspaper.

The group has already raised output targets by about 2.5 million barrels a day this year as it unwound earlier cuts, the Financial Times reported.

Brent crude, the international benchmark, closed Friday at $65.50 a barrel — down 2.2% on the day but still up from a low of $58 a barrel in April.

OPEC+ said it will hold monthly meetings to reassess market conditions and review members’ conformity. The next session is scheduled for Oct. 5.

OPEC+, which includes Saudi Arabia and Russia, has agreed to another large production hike in September.

That’s despite a warning by the International Energy Agency, the extra barrels could tip the market into oversupply later this year.

US President Donald Trump’s tariffs have targeted Russian crude buyers.

But whether those tariffs are imposed depends on the outcome of trade negotiations with India and China.

And even more so on talks over a peace deal in Ukraine between Washington and Moscow.

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July 5 (UPI) — Eight OPEC+ nations on Saturday agreed to increase their crude oil production by 548,000 barrels per day starting in August.

Of the dozen Organization of Petroleum Exporting Countries, five voted to increase the output: Saudi Arabia, Algeria, Iraq, Kuwait, United Arab Emirates. There are 10 subset members with Russia, Kazakhstan and Oman joining the member nations in boosting production.

OPEC nations not voting to increase output are Iran, Venezuela, Congo, Equatorial Guinea, Gabon, Libya, Nigeria.

The increase represents half of a percent of the worldwide production.

In April, the group increased production by 411,000 barrels a day. Also, there were changes in November 2023.

The nations said the change was based on “a steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories.” It also was in accordance with a decision on Dec. 5 to start a gradual and flexible return of the 2.2 million barrels per day starting April 1.

They said the “increases may be paused or reversed subject to evolving market conditions. This flexibility will allow the group to continue to support oil market stability.”

The two largest oil producers are Saudi Arabia at 9.8 million barrels per day in August and Russia at 9.3 million. Iraq is third at 4.1 million.

The United States, which is not a member of OPEC, produced an average of 13.4 million barrels of crude oil a day in August 2024, according to the U.S. Energy Information Administration.

Global Commodity Insights, a research firm, has said it expected supply would outpace demand by 1.25 million barrels a day in the second half of this year. These changes come amid the summer driving season and more oil for air conditioning amid heat waves in many places around the world.

The eight OPEC+ countries will next meet on Aug. 3 to decide on September production levels.

The Saudis have been seeking to boost production to please U.S. President Donald Trump, who has fostered a strong relationship with Saudi Arabia and UAE, The New York Times reported analysts as saying.

On Friday, August West Texas Intermediate oil futures settled at $68.30 per barrel, a decline of 50 cents. It dropped to $57.13 on May 13, which was the lowest since January 2021. The rose to $80.04 on Jan. 15 with it hitting $120.67 in June 2022.

Israel and Iran are engaged in attacks for a fifth straight day, with Israel targeting Iran’s nuclear facilities, military sites, oil and gas facilities, and state TV headquarters.

The escalation has raised fears of a widening conflict and turmoil in global energy markets.

Iran is one of the top global producers of oil and gas and holds the world’s second largest proven natural gas reserves and the thirdlargest crude oil reserves, according to the United States Energy Information Administration.

How big is Iran’s oil industry?

With about 157 billion barrels of proven crude oil, Iran holds about a quarter (24 percent) of the Middle East’s and 12 percent of the world’s proven oil reserves.

Iran is the ninth largest oil producer globally and the fourth largest within OPEC, producing about 3.3 million barrels of crude oil per day. It exports roughly 2 million barrels of crude and refined fuel each day.

In 2023, Iran’s net oil export revenues were estimated at $53bn, up sharply from $37bn in 2021. While Iran’s economy is relatively diversified compared with many of its neighbours, oil continues to be a critical source of government income.

However, years of limited foreign investment and international sanctions have kept Iran’s oil production well below its full potential.

After Israel’s attacks on Iran began on Friday, fears of a wider Middle East conflict sent oil prices soaring nearly 7 percent in a single day. Prices have held steady about that level since.

Where are Iran’s oil facilities?

Iran’s oil facilities are spread across several regions, mainly in the south and west of the country. These include onshore oilfields, offshore platforms, refineries, export terminals and pipelines.

Nearly all of Iran’s crude oil flows through Kharg Island, the country’s main export terminal, which handles close to 1.5 million barrels per day.

More than 20 percent of the world’s seaborne oil passes through the Strait of Hormuz, a narrow maritime chokepoint between Iran and Oman.

Major onshore oilfields include:

• Ahvaz Field – Iran’s largest oilfield and one of the biggest globally
• Gachsaran Field – second-largest Iranian field, producing light crude
• Marun Field – another high-output field near Ahvaz
• Agha Jari, Bibi Hakimeh and Karanj fields – located mostly within Khuzestan province in southwestern Iran, a key oil-producing region

Major offshore fields include:

• Abuzar, Foroozan, Doroud and Salman fields – located in the Gulf and shared with Saudi Arabia and the United Arab Emirates

Its main refineries include:

• Abadan Refinery – one of the oldest and largest refineries in the Middle East
• Tehran Refinery – supplies the capital and nearby provinces
• Isfahan, Bandar Abbas, Arak and Tabriz refineries – process various crude types for domestic use and export

How big is Iran’s gas industry?

Iran has the world’s second largest proven natural gas reserves after Russia. They are estimated at 1,200 trillion cubic feet (34 trillion cubic metres), which accounts for 16 percent of global reserves and 45 percent of OPEC’s total.

Iran is the third highest producer of natural gas behind the US and Russia with production reaching 9,361 billion cubic feet (265 billion cubic metres) in 2023, accounting for at least 6 percent of global production.

Like oil, Iran relies heavily on domestic companies to develop its gasfields due to international sanctions, which have limited foreign investment and technology access.

Where are Iran’s gas facilities?

Iran’s gas facilities are concentrated primarily in the south, especially along the Gulf, with major gasfields and processing plants.

Iran’s largest gasfield, and the largest in the world, is the South Pars field, which it shares with Qatar, where it’s known as the North Field.

Other important gasfields are the North Pars, Golshan, Ferdowsi, Kangan and Nar fields.

Iran’s main gas-processing centre is the South Pars Gas Complex, located in Bushehr province.

Which facilities has Israel attacked?

Israel has struck multiple energy facilities, including the South Pars gasfield, Fajr Jam gas plant, Shahran oil depot, Shahr Rey oil refinery and Tehran fuel depots.

By Tina Teng

Published on
23/05/2025 – 8:14 GMT+2

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Crude oil prices fell for a third consecutive trading day on Thursday ahead of the US-Iran nuclear talks. Traders are growing concerned about the possible return of oil supply from Iran, which holds around one-third of the world’s oil reserves.

Adding to the pressure, a Bloomberg report stated that the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) is considering a third consecutive production hike in July, compounding fears of an oversupplied market.

Oil prices continued to decline during Friday’s Asian session. As of 4:40 am CEST, Brent futures were down 0.59% to $64.06 per barrel, while West Texas Intermediate (WTI) futures fell 0.6% to $60.83 per barrel—both touching their lowest levels in over a week.

Potential oversupply overshadows geopolitical tensions

Crude prices have experienced notable volatility in recent weeks as market participants weigh rising geopolitical tensions against mounting supply from major oil-producing nations. Broader macroeconomic factors—such as easing US-China trade tensions and renewed selling in US Treasuries—have also been influencing oil market movements.

Earlier in the week, prices briefly spiked following a CNN report that Israel was preparing to launch strikes against Iran’s nuclear facilities, citing intelligence from US sources. However, the rally proved short-lived, with analysts suggesting the warning may have been a strategic move by the US to exert pressure on Iran ahead of the nuclear negotiations.

The geopolitical boost was quickly overshadowed on Wednesday by data showing a surge in US crude inventories. According to the Energy Information Administration (EIA), US oil stockpiles rose to 443.2 million barrels in the week ending 16 May—the highest level since July 2024. The report also indicated that net US crude imports had increased for a third consecutive week, while domestic demand remained weaker than expected.

OPEC+ may accelerate production hike

News about OPEC+’s potential acceleration in production hike sent the oil price down further on Thursday. The oil production cartel is reportedly considering hiking crude output by 411,000 barrels per day (bpd) in July. The decision is yet to be finalised on 1 June when the group holds the next meeting.

The group, which accounts for around 40% of global oil supply, has jointly reduced production by approximately 2.2 million bpd in 2023. The quicker-than-expected phased rollback began with a 135,000 bpd increase in April, tripling to 411,000 bpd in May and June. The acceleration is seen as a punitive measure against members which failed to comply with agreed production quotas, with Kazakhstan and Iraq identified as recent overproducers.

Crude prices have consistently fallen following OPEC+ announcements of larger-than-expected production increases in both April and May. However, the potential July decision may already be priced in by markets—unless the group surprises traders with an even more aggressive supply boost.

Demand outlook remains weak

The demand outlook remains fragile amid ongoing concerns over slowing global growth, particularly driven by the US tariffs. Crude prices had previously dropped to a four-year low on 9 April and again on 5 May. The oil market rebounded following the US and China’s trade talks earlier this month, when the world’s two largest economies reached an agreement to pause high tariffs on each other for 90 days.

While near-term pressure remains supply-driven, there is cautious optimism that a sustained recovery in market sentiment, driven by further progress in US tariff negotiations, could support a rebound in oil demand.

“While the immediate pressure comes from the supply side, I believe that in the longer term, further progress on US tariff negotiations with key partners could revive demand and offer more meaningful support for oil,” Dilin Wu, a research strategist at Pepperstone Australia, said.