OPEC+ signals ambition with another oil production boost: What it means for market

Dubai: Eight major OPEC+ members have agreed to raise oil production again, a move analysts say is aimed at grabbing more market share, even if it risks lower prices.

The V8 group — Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman — announced on Sunday they will increase output by 137,000 barrels per day (bpd) starting next month.

This comes on top of a 2.2 million bpd boost already added in recent months. Over time, the group said up to 1.65 million extra barrels per day could hit global markets.

“OPEC+ caught the market off guard — instead of pausing, the group signaled ambition,” said Jorge Leon, an analyst at Rystad Energy. “The barrels may be small, but the message is big. They are prioritizing market share even if it pushes prices lower.”

Oil prices have been hovering between $65 and $70 per barrel, down 12% this year, pressured by increased output from non-OPEC producers and tariffs affecting demand. Analysts had expected the V8 to hold production steady in October. By raising it now, the group shows it is willing to tolerate prices falling below $60 to reclaim influence over global crude markets.

Leon noted that the actual production increase will likely be smaller due to capacity limits and internal compensation mechanisms, but perception matters as much as actual barrels. “It also raises questions about unity. Russia relies on high prices to fund its military, while others are testing lower prices for market share,” he said.

The final months of the year could prove challenging. Seasonal demand typically slows, and developments in Russia’s war in Ukraine and US-Russia relations could further affect oil markets.

US President Donald Trump has imposed tariffs on countries like India for buying Russian oil and has criticized EU nations, including Hungary and Slovakia, for their imports. Analysts say curbing Russian exports could create opportunities for OPEC+ producers to expand their sales.

For now, OPEC+ appears focused on strategy over short-term price swings, signaling a willingness to sacrifice some revenue today to secure a larger share of tomorrow’s global oil market. The industry and investors will be watching closely to see how long this approach can last, especially amid geopolitical tensions and fluctuating seasonal demand.

- With inputs from Agencies