OPEC+ Blinks: First Output Hike Since 2022 Shakes Markets

OPEC+ Blinks: First Output Hike Since 2022 Shakes Markets | OilPrice.com

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Breaking News:

ByJulianne Geiger– Mar 03, 2025, 4:30 PM CST

OPEC+ has finally decided to go through with its long-delayed oil production increase, adding about 138,000 barrels per day to its production plans beginning in April, according to Reuters calculations. It’s the first output hike for OPEC since 2022, marking a cautious step toward unwinding the 2.2 million bpd in cuts the cartel has been clinging to like a security blanket.

Oil prices were trading deep in the red in afternoon trade.

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The decision comes as U.S. President Donald Trump renews his calls for lower oil prices, pressuring Saudi Arabia and its allies to pump more. With crude hovering around $71 per barrel and a volatile mix of geopolitical and economic uncertainty in play—like U.S. sanctions on Russia, Iran, and Venezuela, plus a looming global tariff war—OPEC+ didn’t have an easy time deciding this move.

According to OPEC insider Amena Bakr, the production plan is to slowly phase out the 2.2 million bpd in cuts from April to September 2026.

Source: Amena Bakr

“This gradual increase may be paused or reversed subject to market conditions,” OPEC+ said in its best corporate-speak for “we’ll see how this goes.” The group is still nursing a production cut of 5.85 million bpd—about 5.7% of global supply—adopted in stages since 2022 to prop up prices. But with Trump reportedly entertaining the idea of cutting Iranian exports to zero while also dangling the possibility of a Ukraine-Russia peace deal (which could unleash more Russian crude), the oil market is playing a high-stakes guessing game.

Internal OPEC+ dynamics are rumored to be a little spicy. Saudi Arabia, the ever-cautious market stabilizer, was said last week to be not so thrilled about opening the production floodgates in haste. The UAE, on the other hand, has been itching to boost output and has previously flirted with the idea of quitting the cartel altogether. With Chinese demand wobbling, it’s likely that today’s announced increase is merely a test balloon rather than a policy shift.

Bottom line? OPEC+ is dipping its toes back into the production pool, but whether it goes for a full cannonball depends on how the market—and Trump—reacts.

By Julianne Geiger for Oilprice.com

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