OPEC+ boosting oil production by 50% more than expected

OPEC and its allied producers agreed Thursday to boost oil production by over 200,000 more barrels a day than expected in July and August.

Why it matters: The move may help ease surging oil prices and rising inflation over the high-demand summer months.

• It may also help to overcome Russian production shortages as a result of its unprovoked invasion of Ukraine.

By the numbers: OPEC now plans to produce around 650,000 additional barrels a day over those months.

• It had only planned to increase production by 432,000 barrels per day.

The big picture: The boost comes just days after European Union leaders agreed to block most Russian oil imports over its invasion of Ukraine.

• It could also thaw relations between the U.S. and Saudi Arabia, which will likely account for most of the supply increases along with the United Arab Emirates, according to the Financial Times.
• President Biden is considering visiting Saudi Arabia to meet its de facto ruler Prince Mohammed bin Salman, whom he has heavily criticized over human rights abuses, namely the killing of U.S.-based journalist Jamal Khashoggi.

What they're saying: "Recent media reports suggest today’s change could herald a broader thaw between Riyadh and Washington ahead of a formal visit to the Kingdom by President Joe Biden," ClearView Energy Partners said in a note Thursday.

• "It might, but we would suggest, more fundamentally, that OPEC may be looking out for its own interests: high oil prices could bring demand destruction and push import-reliant economies into recession."

Go deeper ... Once-unthinkable: Subsidies for American oil drillers

Editor's note: This article has been corrected to note that OPEC+ is increasing oil production by 200,000 more barrels a day than expected, not 200,000 additional barrels a day.