OPEC+ to Increase Oil Output by 137,000 Barrels per Day from October

OPEC+ has announced a decision to raise oil production by 137,000 barrels per day starting in October 2025. This move marks a shift from previous cuts aimed at supporting oil prices, as the alliance seeks to regain market share amid fluctuating global demand. The adjustment reflects a strategic recalibration in the group’s approach to balancing supply and demand dynamics.

Strategic Shift in Production Policy

The decision to increase output comes after a period of production cuts totaling 1.65 million barrels per day, which were intended to last through the end of 2026. However, with oil prices falling over 10% this year and concerns about a potential supply glut, OPEC+ has opted to unwind some of these cuts ahead of schedule. The latest increase is a modest step compared to previous months’ hikes, signaling a cautious approach to adjusting production levels.

Market Reactions and Implications

Despite the increase in production, oil prices have shown resilience. Brent crude rose to $66.30 per barrel, and U.S. West Texas Intermediate increased to $62.62 per barrel. Analysts attribute this uptick to concerns over potential new sanctions on Russian crude, which could tighten global supply. Additionally, the smaller-than-expected output hike by OPEC+ has provided some support to prices.

Impact on India and Tier 2 Cities

For India, particularly in Tier 2 cities where fuel consumption is on the rise, the increase in oil production may have mixed effects. While the potential for slightly lower oil prices could ease fuel costs, the overall impact will depend on various factors, including exchange rates and domestic taxation policies. Consumers in these regions may experience modest changes in fuel prices, but significant fluctuations are unlikely in the short term.

Conclusion

OPEC+’s decision to incrementally increase oil production reflects a strategic shift towards regaining market share while monitoring global demand trends. The cautious approach aims to balance supply adjustments with market stability. For consumers in India, especially in Tier 2 cities, the immediate impact on fuel prices may be limited, but ongoing developments in global oil markets will continue to influence domestic energy costs.