US believes Opec has more capacity to raise crude production

THE administration believes the Organisation of Petroleum Exporting Countries (Opec) has room to raise production should an upcoming visit by President Joe Biden to the Middle East yield any agreements.

"We do believe there is a capacity for further steps that could be taken," National Security Advisor Jake Sullivan said in a press conference on Monday (Jul 11). It's ultimately up to Opec countries to determine what those additional steps entail, he said.

Biden has intensified efforts to lobby the production cartel for more output in an effort to tame rising energy prices. He is making his first visit to the Middle East this week, which will include a stop in Saudi Arabia. The kingdom and the UAE are the only Opec members with significant volumes of unused output. They currently have a buffer of about 3 million barrels a day, official data from the countries indicate.

Earlier this month, Saudi Arabia offered up what was widely interpreted as a reconciliatory gesture toward Washington by steering the Opec+ alliance to speed up its output increases in July and August.

Yet even with the increase, Riyadh only delivered about a fifth of the amount it was due to provide, prompting concerns that the kingdom may have limited spare production capacity. That leaves production at 10.45 million barrels a day, or roughly 210,000 below its target. BLOOMBERG