Released September 09, 2025 | SUGAR LAND
en
Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Parties to an OPEC-led effort to maintain market stability may be going after market share and revenue with a decision to gradually put more barrels on the market, analysts said Monday.
The Organization of the Petroleum Exporting Countries (OPEC) and non-member state allies such as Russia are coordinating under the umbrella of OPEC+ to ostensibly keep markets in check. Pointing to a "steady global economic outlook and current healthy market fundamentals," the group said Sunday it would lift production by around 137,000 barrels per day (BBL/d) starting in October.
Production curtailments of around 1.65 million BBL/d were set to remain in place until the end of 2026. Ole Hanson, the head of commodity strategy at Saxo Bank in Denmark, said the market reaction was a bit overdone on Monday, though the addition of new barrels comes as some member states are still producing more than committed.
"The move underscores the group's effort to regain market share and boost revenues, while the immediate impact remains limited as Iraq, Kazakhstan, and the UAE must fully compensate for overproduction since January 2024," he said in a Monday newsletter.
Iraq has nonetheless faced headwinds in oil production this year, despite early-year commitments from BP Plc (London, England) to redevelop oil fields in the semi-autonomous Kurdish north of Iraq, where the estimated combined reserves top 9 billion barrels of oil equivalent. Norwegian oil and gas operator DNO ASA (Oslo) was later forced to curtail operations at its Tawke license in Kurdistan after a series of successive drone strikes in July.
For more information, see July 24, 2025, article - Drone Attacks Halt Oil Field Production in Iraqi Kurdistan.
Central Asian suppliers have faced setbacks this year as well. Kazakhstan and Azerbaijan are expected to play an increasingly important role in the supply of oil to Europe, particularly in light of the European Union's sanctions on Russian oil. Issues were apparent earlier this year when contamination was found in an oil pipeline stretching from Azerbaijan to Turkish ports.
The market reaction to the OPEC+ decision, however, was not a muted one, with the price for Brent crude oil, the global benchmark, up some 1.25% at the opening bell Monday to trade at $66.31 per barrel. But despite the initial market rally, it may be a signal that OPEC+ can tolerate a lower-for-longer price cycle.
U.S. President Donald Trump may have put a bit of a spanner in the gears, however, by threatening Russia, a party to OPEC+, with additional sanctions. After Russian forces on Sunday hit the main government building in Kiev for the first time since fighting began in 2022, Trump said that Russia would face a "second phase" of punishing sanctions.
Already over-producing against a backdrop of global trade tensions, the future market direction may test the U.S. shale oil market at a time when major energy companies are feeling the pinch. ConocoPhillips (Houston, Texas) last week became the latest major oil company to announce it would be cutting jobs when it confirmed a Wall Street Journal report that it would shed up to 25% of its workforce, of around 13,000 staff.
Earlier this year, Chevron (Houston) said it would cut about 20% of its staff and move about 6,000 jobs to India, where labor costs are lower.
That comes amid signs the U.S. shale oil sector is slowing down. While Trump is a fossil-fuels advocate, his trade policies are undermining growth and creating headwinds for crude oil prices.
The U.S. federal government expects crude oil prices next year to be well below the point at which many U.S. shale drillers can make a profit. Production trends, meanwhile, are softening. Federal estimates are pointing to a 0.7% year-on-year reduction in crude oil production to 13.3 million BBL/d.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
The Organization of the Petroleum Exporting Countries (OPEC) and non-member state allies such as Russia are coordinating under the umbrella of OPEC+ to ostensibly keep markets in check. Pointing to a "steady global economic outlook and current healthy market fundamentals," the group said Sunday it would lift production by around 137,000 barrels per day (BBL/d) starting in October.
Production curtailments of around 1.65 million BBL/d were set to remain in place until the end of 2026. Ole Hanson, the head of commodity strategy at Saxo Bank in Denmark, said the market reaction was a bit overdone on Monday, though the addition of new barrels comes as some member states are still producing more than committed.
"The move underscores the group's effort to regain market share and boost revenues, while the immediate impact remains limited as Iraq, Kazakhstan, and the UAE must fully compensate for overproduction since January 2024," he said in a Monday newsletter.
Iraq has nonetheless faced headwinds in oil production this year, despite early-year commitments from BP Plc (London, England) to redevelop oil fields in the semi-autonomous Kurdish north of Iraq, where the estimated combined reserves top 9 billion barrels of oil equivalent. Norwegian oil and gas operator DNO ASA (Oslo) was later forced to curtail operations at its Tawke license in Kurdistan after a series of successive drone strikes in July.
For more information, see July 24, 2025, article - Drone Attacks Halt Oil Field Production in Iraqi Kurdistan.
Central Asian suppliers have faced setbacks this year as well. Kazakhstan and Azerbaijan are expected to play an increasingly important role in the supply of oil to Europe, particularly in light of the European Union's sanctions on Russian oil. Issues were apparent earlier this year when contamination was found in an oil pipeline stretching from Azerbaijan to Turkish ports.
The market reaction to the OPEC+ decision, however, was not a muted one, with the price for Brent crude oil, the global benchmark, up some 1.25% at the opening bell Monday to trade at $66.31 per barrel. But despite the initial market rally, it may be a signal that OPEC+ can tolerate a lower-for-longer price cycle.
U.S. President Donald Trump may have put a bit of a spanner in the gears, however, by threatening Russia, a party to OPEC+, with additional sanctions. After Russian forces on Sunday hit the main government building in Kiev for the first time since fighting began in 2022, Trump said that Russia would face a "second phase" of punishing sanctions.
Already over-producing against a backdrop of global trade tensions, the future market direction may test the U.S. shale oil market at a time when major energy companies are feeling the pinch. ConocoPhillips (Houston, Texas) last week became the latest major oil company to announce it would be cutting jobs when it confirmed a Wall Street Journal report that it would shed up to 25% of its workforce, of around 13,000 staff.
Earlier this year, Chevron (Houston) said it would cut about 20% of its staff and move about 6,000 jobs to India, where labor costs are lower.
That comes amid signs the U.S. shale oil sector is slowing down. While Trump is a fossil-fuels advocate, his trade policies are undermining growth and creating headwinds for crude oil prices.
The U.S. federal government expects crude oil prices next year to be well below the point at which many U.S. shale drillers can make a profit. Production trends, meanwhile, are softening. Federal estimates are pointing to a 0.7% year-on-year reduction in crude oil production to 13.3 million BBL/d.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
