Oil Output to Increase by 1 Million Barrels after OPEC Reaches Compromise

In order to reduce supply shortage and aid the reduction of prices, major oil producers have reached a compromise to pump more crude oil. Over the past 18 months, the OPEC has been curbing the oil output and creating a shortage to increase prices. 

The oil prices have increased as much as 20 percent this year. In a summit that occurred in Vienna on Friday, OPEC members agreed to boost crude oil production. Head of OPEC and Energy Minister of the UAE, Suhail Mohammed Faraj, stated that the OPEC will increase the output to the maximum amount which is permissible under the agreement signed in 2016. This agreement was made between OPEC members and other major oil producing countries like Russia to curb the production of oil to take away excess oil from the market. Faraj has stated that OPEC and other oil producing countries will collaborate to increase the production of oil by 1 million barrels a day. 

However, the production of oil has been dipped even more than the amount agreed in 2016 owing to the outages in Venezuela. The ever increasing demand has met with a supply shortage in the aftermath. Some OPEC members stated that they will face troubles in increasing production immediately. The OPEC has not mentioned which of the member countries will fill the void which will enter into the world market by July 2018. 

Oil minister of Saudi Arabia has stated that there is a possibility of deficit reaching up to 1.8 million barrels a day in the second half of the year. President Trump has also recently jumped in to lambaste the OPEC for curbing production to drive up the oil prices. On Saturday, the OPEC is going to conduct talks with the members outside of the OPEC that signed the agreement in 2016 in order to reach a compromise.