Oil prices dropped on Monday following an unexpected decision by OPEC to significantly increase crude oil production in August 2025, prompting concerns about market oversupply and declining revenue across oil-producing nations.
Brent crude futures declined by 47 cents, or 0.69%, settling at $67.83 per barrel as of 03:27 GMT. Meanwhile, U.S. West Texas Intermediate crude dipped by 95 cents, or 1.42%, to $66.05 per barrel.
The losses came in reaction to the oil cartel’s announcement over the weekend that it would ramp up output by 548,000 barrels per day (bpd) in August — a much steeper increase than anticipated by industry analysts.
The Organisation of the Petroleum Exporting Countries and its allies, collectively known as OPEC+, made the decision during a Saturday meeting, signaling a renewed push for greater market share amid stabilizing global demand.
Energy strategist Tim Evans of Evans Energy described the move as a bold market play. “The increased production clearly represents a more aggressive competition for market share and some tolerance for the resulting decline in price and revenue,” he said in a note.
This new output level marks a sharp jump from previous increments: OPEC+ had previously approved more modest monthly increases of 411,000 bpd for May through July, and only 138,000 bpd in April.
The latest decision would return nearly 80% of the 2.2 million bpd that eight OPEC members had voluntarily cut earlier this year in an attempt to prop up prices.
READ ALSO: OPEC sticks to oil demand forecast through 2026
Analysts at RBC Capital Markets, led by Helima Croft, told Reuters that although the commitment to increased output is clear, the actual volume hitting the market has consistently fallen short of projections.
Most of the supply surge so far has originated from Saudi Arabia, which continues to play a dominant role within the group.
In a move seen as a vote of confidence in global demand recovery, Saudi Arabia also raised its official selling price for Arab Light crude to Asian customers.
The August pricing now stands at its highest in four months, a sign that Riyadh expects refiners to absorb the additional barrels.
Looking ahead, analysts at Goldman Sachs expect OPEC+ to announce one final production hike for the year — a 550,000 bpd increase slated for September — at its next ministerial meeting scheduled for August 3.
TheConclave
