The Organization of Petroleum Exporting Countries (OPEC) oil cartel and allied countries – together called OPEC+ – have decided gradually to add back some 2 million barrels per barrel (bpd) of oil production from May to July. The decision is seen as a cautious move in pace with recovery of the global economy from COVID-19 pandemic.

The OPEC+ is gingerly adding back production that was slashed last year to support prices as demand sagged during the worst of the pandemic recession, which sapped demand for fuel. The group will add back 350,000 bpd in May, 350,000 bpd in June and 400,000 bpd in July. Meanwhile, Saudi Arabia will restore an additional 1 million bpd in cuts that it had made on its own.

OPEC members, led by Saudi Arabia, and non-members, led by Russia, have been meeting monthly to determine production levels as they face a recovery in demand whose pace has been uncertain. They face conflicting pressures. Raising production before the demand is there risks sending prices lower. But lower production levels deprive national budgets of money at a difficult time.

Oil prices were trading higher despite the decision to increase production, suggesting that markets see more than adequate demand for the added oil. The West Texas Intermediate (WTI) crude oil was trading around $61.56 per barrel, while Brent crude oil was hovering around $64.96 per barrel.