10/06/2025 by Joel Thompson
Multinational investment bank Goldman Sachs expects the OPEC+ group to cease increasing production after August.
Despite crude oil trading just over $60 per barrel recently, OPEC+ has continued to unwind some of its voluntary production cuts. In May and June, it raised its permitted production by 411,000 barrels per day. Moreover, it recently announced an identical hike for July, and analysts at Goldman think it will do the same one more time for August. Goldman then expects a slowdown in global economic growth combined with increasing production from countries outside the OPEC+ group.
A note from the investment bank, as quoted by Reuters, said:
“Relatively tight spot oil fundamentals, beats in hard global activity data, and seasonal summer support to oil demand suggest that the expected demand slowdown is unlikely to be sharp enough to stop raising production when deciding on August production levels on July 6th.”
There is much speculation about the ongoing decisions to increase production when oil prices are lower than many oil-producing countries would like. Some point to annoyance in Saudi Arabia at some OPEC+ members consistently overproducing. Others suggest it may be a response to the US President’s calls for lower oil prices.
A stop to the production increases will be welcomed by operators of assets with high breakeven costs. Big producers like TotalEnergies and Chevron, the makers of the Total and Texaco grease and lubricant products, have been driving down production costs. Nevertheless, many producers are struggling to operate profitably at current oil prices.
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