Aug. 3 (BP) — Representatives of the world’s major oil producing countries voted Wednesday to increase production slightly, far less than U.S. President Joe Biden hoped for to boost supplies and ease the pain at the pump for cash-strapped Americans.
Ministers for members of the Organization of the Petroleum Exporting Countries and allies including Saudi Arabia and Russia, known as OPEC+, raised its output targets by 100,000 barrels a day for September.
The move, which was considered mostly symbolic, was equivalent to 86 seconds of global oil demand, analysts said, adding that it was considered in the industry as an insult to Biden.
OPEC cut back on production during COVID-19 pandemic shutdowns, causing prices to plummet as demand for fuel around the globe weakened.
With the decrease in production set to expire next month, oil ministers at this year’s conference faced increasing pressure to act amid staggering inflation combined with volatile oil markets are causing concern about the future health of the world economy.
After gradually increasing output in previous months, the cartel was weighing U.S. demand for more crude against Russia’s insistence on keeping prices high to make up for its diminished oil exports amid the ongoing war in Ukraine.
Many nations have imposed sanctions that prohibit imports of Russian oil, while Russian President Vladimir Putin has squeezed supply to more than a dozen European countries that rely on its resources.
While gas prices remain high, the cost per gallon has eased considerably over the past month in the United States, mostly due to lower consumer demand.
The price for regular unleaded was averaging $4.16 per gallon Wednesday. In June the national average reached a record high of $5 a gallon. While prices have fallen in recent weeks, they remain 32% higher than what drivers were paying at this same time in 2021.
Brent-crude oil futures rose slightly Wednesday to $101.85, but this price was forecast to rise to $125 a barrel through mid-2023.
President Joe Biden paid a visit to Saudi Arabia last month in an effort to renew relations while pushing for more production. However there were no noteworthy agreements to come out of the meeting.
The gathering will be OPEC’s first since its former secretary general, Mohammad Sanusi Barkindo of Nigeria died last month.