The escalating confrontation between Israel and Iran has reignited fears over the stability of oil supplies from the Middle East. Against this backdrop, OPEC+, under the leadership of Saudi Arabia, has made the surprising decision to increase oil production despite falling prices, reports the Baltimore Chronicle citing Financial Times.
Some experts believe this move may have been influenced by political pressure from the United States, which seeks to curb inflation and prepare for potential energy market shocks. However, analysts suggest that Saudi Arabia also had domestic reasons to revise its oil policy.
For nearly three years, OPEC+ has pursued production cuts to support prices. Yet this approach has recently proved less effective. Certain cartel members, particularly Kazakhstan, have been exceeding their quotas, causing frustration in Riyadh, which has borne the bulk of the financial burden.
Saudi Arabia has not forgotten the consequences of its 2018 decision to raise output at Washington’s request—a move that led to a sharp price drop and inflicted damage on its national budget.
Additionally, the production increase may reflect broader efforts to strengthen strategic ties with the U.S. Saudi Arabia is reportedly interested in gaining access to American technologies in artificial intelligence, defense, and nuclear energy sectors.
Now, with oil prices once again rising due to growing Middle Eastern tensions, the United States may turn to its strategic reserves or ask Riyadh once more to boost supplies. However, OPEC+ is likely to act cautiously, mindful of the region’s delicate balance.
Earlier we wrote that Saudi Arabia executes journalist Turki al-Jasser.