The Organization of Petroleum Exporting Countries (OPEC) and its allies decided to increase world oil output by 400,000 barrels per day in a statement issued at the end of the 19th OPEC and non-OPEC ministerial meeting on Sunday. This new development comes as economies continue to improve and crude demand recovers around the world.

OPEC and its OPEC+ partners, led by Russia, agreed to release barrels of bottled-up petroleum over the next two years by promising to restore all cuts made at the outset of the coronavirus outbreak. The new adjustment will be in effect from August through December 2021, according to the Organisation.

After Saudi Arabia and others consented to a United Arab Emirates (UAE) proposal that jeopardised the plan, the group stated it agreed to fresh production allocations starting in May 2022.

Excerpts from the statement “In view of current oil market fundamentals and the consensus on its outlook, the Meeting resolved to reaffirm the Framework of the Declaration of Cooperation, signed on 10 December 2016 and further endorsed in subsequent meetings, including on 12 April 2020.”

“Extend the decision of the 10th OPEC and non-OPEC Ministerial Meeting (April 2020) until the 31st of December 2022.”

“Adjust upward their overall production by 0.4 mb/d on a monthly basis starting August 2021 until phasing out the 5.8 mb/d production adjustment, and in December 2021 assess market developments and participating countries’ performance.”

For the duration of the Declaration of Cooperation, the Organisation said it is going to stick to the system of holding monthly OPEC and non-OPEC ministerial meetings to analyse market circumstances and decide on production level adjustments for the next month.