Oil prices surged over $1 a barrel on Monday after OPEC+ confirmed it would raise production in July by 411,000 barrels per day, matching increases from the past two months. The decision eased market fears of a larger output hike, which many had anticipated and which could have led to a sharper decline in prices.
Brent crude rose by $1.34 to $64.12 a barrel, while U.S. West Texas Intermediate climbed $1.52 to $62.31. Both benchmarks had dipped last week, but the relief rally showed traders were largely comfortable with the expected production strategy. Analysts noted that the modest increase had already been factored into futures pricing.
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The move by OPEC+ appears aimed at maintaining market stability while reasserting control over members such as Iraq and Kazakhstan, which have exceeded their output limits. Kazakhstan, for instance, has openly stated it won’t reduce its production levels despite OPEC+ expectations.
Meanwhile, supply concerns in the U.S. are growing as fuel inventories remain low ahead of a potentially active hurricane season. A spike in gasoline demand, paired with a decline in active U.S. oil rigs, has added to the bullish sentiment in the market.
