Global crude and condensate exports have demonstrated a consistent upward trend since September of last year, a surge primarily propelled by an increase in exports from OPEC+ nations. In contrast, exports from non-OPEC+ producers have largely maintained stability since mid-2023.
OPEC-8 Export Shortfall and Production Dynamics
Since April 2023, the eight core OPEC+ members (OPEC-8) have implemented voluntary production cuts totaling 2.2 million barrels per day (mbd). While these countries have been accelerating the unwinding of these cuts over the past three months, their crude exports have not met anticipated levels. This is despite a reported 959,000 barrels per day (kbd) increase in their production target compared to March 2025.
The discrepancy between target and actual exports may be attributed, in part, to 431 kbd in compensation cuts. This suggests that some members might be reining in production to compensate for past overproduction relative to their quotas. However, it’s also noted that actual output increases have been smaller than planned, with Saudi Arabia largely accounting for most of the supply increase. For August 2025, OPEC+ agreed to raise production by 548,000 bpd, a more aggressive increase than the 411,000 bpd monthly hikes seen from May through July. This move is expected to bring nearly 80% of the 2.2 mbd voluntary cuts back into the market.
Rising Inventories and Price Sensitivity
Crude oil prices, specifically Brent and WTI futures, retreated below $70/bbl in late June 2025. As of July 7, 2025, Brent crude is trading around $67.23/bbl and WTI at $65.92/bbl. This decline reflects an easing of tensions in the Middle East and a growing market awareness of increasing oil supply availability.
Global onshore crude inventories have risen significantly by approximately 200 million barrels over the past four months, with China leading these stock builds. This build-up of inventories indicates that supply growth is currently outpacing demand, leading to a more comfortable market supply situation.
Market Share vs. Price Stability
With prices dipping, oil producers are now faced with a crucial decision: whether to prioritize vying for market share by increasing production or maintaining supply-demand balance to support prices. This decision is heavily influenced by each producer’s cost of production and their capacity to withstand prolonged periods of lower oil prices.
For instance, countries like Saudi Arabia, Iran, and Iraq boast some of the lowest production costs globally, often below $10 per barrel, allowing them to remain profitable even at significantly lower prices. In contrast, producers with higher breakeven costs might be more incentivized to curb output to support prices.
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Source: Breakwave Advisors
