(IMPORTANT) OPEC+ Policy: Perception Over Reality
Don't try to make sense out of nonsense.
OPEC+ announced on Saturday that another truncated production increase (~411k b/d) will occur in June. This brings the total voluntary production increase to 959k b/d.
The oil market, rightfully so, sold off immediately on Sunday's open with WTI testing $55/bbl at one point. With the consensus already worried over the oil market balance of 2025 (due to demand worries and now supply increases from OPEC+), the production increase is giving bears more ammunition to the downside.
But as I explained in an article we published titled "OPEC+ Gameplan." The truncated production increase is not what it appears because it's never been a cohesive OPEC+ production cut. It has been a Saudi production cut since the beginning and any "material" increase in production will come from the Saudis.
In this article, I will give you my latest thoughts on the OPEC+ production increase and what I expect going forward. I will also give you my latest thoughts on the oil market and energy stocks.