The OPEC oil cartel and its allies decided Wednesday to boost production in September by a much slower pace than in previous months at a time of high gasoline prices and exacerbated by .
OPEC, led by Saudi Arabia, and its allies, led by Russia, said they will increase output to 100,000 barrels a day next month after raising it by 648,000 barrels per day in July and August. The group considered what effects and may have on global demand for fuel in the fall.
It comes after U.S. President Joe Biden visited Saudi Arabia last month, aiming to improve relations and encourage more oil production from the cartel to draw down high prices at the pump. While gasoline prices have been falling, they are still high and for him as .
There was no oil production agreement announced after the meeting, but . Those hopes didn't materialize.
As a result, 鈥渢he U.S. may go looking for other sources of oil, whether it鈥檚 Venezuela or Iran,鈥� said Jacques Rousseau, managing director at Clearview Energy Partners.
Biden's administration also is encouraging the U.S. oil and gas industry to increase production.
鈥淵ou鈥檝e just seen the . They are record profits,鈥� Amos Hochstein, a senior adviser for energy security at the State Department, said Wednesday on CNBC. "They should be investing those dollars right back into production increases.鈥�
The OPEC+ coalition had curtailed production during the pandemic as oil prices and demand plummeted, and . The group has been gradually adding more oil and gas to the market as economies recovered.
Some OPEC nations, such as Angola and Nigeria, have been producing less than the agreed-upon amount. Saudi Arabia and United Arab Emirates, on the other hand, have the capacity to increase production.
OPEC's decision appears to be an attempt to appease those countries that can't produce more, Rousseau said.
鈥淎ny time you increase the target, there鈥檚 countries that can鈥檛 participate,鈥� he added. 鈥淚f you only raise production by 100,000 barrels per day, that鈥檚 just a small piece for everybody.鈥�
As a result, the amount of oil on the market might not keep up with demand, so high oil prices may persist for some time.
The price of oil rose sharply after Russia invaded Ukraine in February. It fell somewhat since OPEC last met but rose modestly Wednesday. A barrel of U.S. benchmark crude was selling for just over $94 Wednesday, compared with more than $105 per barrel a month ago. Brent crude, the international standard, was selling for just over $100 a barrel Wednesday, also down about $110 from a month ago.
Russia's oil and natural gas exports to the world have declined as many nations imposed sanctions or curtailed buying from the major supplier due to its invasion of Ukraine. to a dozen European countries, further driving up energy prices, squeezing people's spending power and threatening to cause a recession if nations can't .
It was the first official monthly meeting of the OPEC+ group since its leader, at age 63 in his home country of Nigeria last month. Haitham al-Ghais, a veteran of the Kuwait Petroleum Corporation, of OPEC this week.
In the U.S., a gallon of regular gasoline was selling for $4.16 on average Wednesday. That鈥檚 substantially lower than in June, when the , but it鈥檚 still painfully high for many frontline workers and families to afford and about 31% higher than what drivers were paying a year ago.
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Associated Press writer Zeke Miller in Washington contributed to this report.
Cathy Bussewitz, The Associated Press
