OPEC+ boosts oil production, causing oil prices to plummet

In a press release dated 3 March, OPEC+ confirmed its intention to gradually increase its oil production from April 2025, putting an end to several months of restrictions. This decision, which provides for the reintroduction of 2.2 million barrels per day over 18 months - i.e. an extra 120,000 barrels per month - immediately sent oil prices plummeting. Brent crude, the benchmark for Europe, Africa and the Middle East, fell to 69.75 dollars a barrel, its lowest level since September 2024.

This strategic shift marks a change for the cartel, made up of the Organisation of the Petroleum Exporting Countries and its allies, including Russia. After postponing a production increase three times when Brent crude fell below $75, OPEC+ now believes that market conditions are conducive to a recovery. Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman will lead the increase, which is designed to meet domestic needs while influencing global dynamics.

Russia played a key role in this announcement, according to analysts. Arne Lohmann Rasmussen, of Global Risk Management, believes that Moscow could be seeking to support negotiations on Ukraine, potentially in connection with a favourable agreement. International pressure, particularly from the Trump administration, has also weighed in the balance. At the World Economic Forum in Davos in January, the former US president called on OPEC+ to increase its production in order to bring down prices and counter inflation in the United States. "I will ask Saudi Arabia and OPEC to lower the price of oil", he said.

US policy towards Venezuela and Iran also influenced this decision. The recent revocation of Chevron's licence in Venezuela, reducing its production by 100,000 barrels a day, and restrictions on Iranian exports have freed up space in the market, allowing OPEC+ to act without risking a price spike.

The markets were quick to respond. Analysts at DNB forecast that Brent could oscillate between 60 and 70 dollars a barrel, accentuating the risk of oversupply. This drop threatens American shale oil producers, whose profitability could be compromised below 60 dollars, according to Jorge Leon of Rystad Energy.

Within OPEC+, the decision raises internal challenges. Countries such as Iraq and Kazakhstan, which have frequently exceeded their quotas in recent months, could complicate collective discipline. This new strategy could exacerbate tensions between members, while testing the cartel's ability to maintain a fragile balance on the world market.

By opting for this gradual increase, OPEC+ is seeking to reconcile its economic interests with international expectations. While it responds to pressure for lower prices, it also risks weakening certain producers, both within and outside the group. As the oil market enters a phase of uncertainty, the next few months will be crucial in assessing the repercussions of this change of direction.