With Brent crude prices rising all around the world, the Organisation of Petroleum Exporting Countries and its allies (OPEC+) has revised its decision to increase the supply of crude oil per day and Kuwait has voiced its support for this plan, according to media reports. The announcement was made by Kuwait’s oil minister Mohammad Abdulatif al-Fares. The plan provides a monthly increase of 400,000 barrels per day and it will also ensure there is a proper balance of oil in the global market.
Earlier last month, oil prices hit their highest levels in the last three years after the world’s major oil producers announced they had decided to keep a cap on crude supplies. Brent crude went up by 40 cents, standing at $81.66 a barrel and U.S. West Texas Intermediate (WTI) oil rose 30 cents to $77.92 per barrel.
OPEC+ said that it will maintain an agreement to increase oil production only gradually, as the world recovers from the Covid-19 pandemic. Reports suggest that oil prices have already surged more than 50 percent in 2021. This has resulted in inflationary pressures that worry crude-consuming countries like the US and India, worrying that increased oil prices might derail the recovery from the pandemic.
Even though OPEC+ has received a lot of pressure to increase its production, OPEC+ was concerned that a fourth global wave of Covid-19 could hit the demand recovery. Despite a lot of talks about demand and supply shortage, Russian Deputy Prime Minister Alexander Novak said that he believes the market is now balanced.