OPEC and its allies agreed to gradually add more oil supplies to the market after Saudi Arabia and the United Arab Emirates resolved a dispute that was blocking the deal.
The cartel will boost output by as much as 400,000 barrels a day each month from August until all of its halted output has been revived, delegates said. The deal will also give the UAE, Iraq and Kuwait higher output quotas from May 2022, the delegates said, asking not to be named because the information isn’t public.
The truce will ease a looming supply squeeze and reduce the risk of an inflationary oil price spike. It also puts an end to a diplomatic spat that unnerved traders, as the fight between the two long-time allies risked unraveling the broader accord between the Organization of Petroleum Exporting Countries and its allies that’s underpinned the recovery in crude prices.
While crude prices dropped last week amid fears about the spread of the delta variant of Covid-19, the International Energy Agency has warned that the market needs more oil from OPEC+, otherwise it will “tighten significantly.”
Never miss a story! Stay connected and informed with Mint.
Download
our App Now!!
