OPEC could raise oil output from July if Venezuelan and Iranian supply drops further and prices keep rallying because extending production cuts with Russia and other allies could overtighten the market, sources familiar with the matter said, ONA reports.
Venezuelan crude production has dropped below 1 million barrels per day (bpd) because of U.S. sanctions. Iranian supply could fall further after May if, as many expect, Washington tightens its sanctions against Tehran.
"If there was a big drop in supply and oil went up to $85, that's something we don't want to see, so we may have to increase output," one OPEC source said.
The market outlook remains unclear and much depends on how far Washington tightens the screw on Iran and Venezuela before OPEC's June meeting, the source added.
Note that the Organization of the Petroleum Exporting Countries, Russia and other producers, an alliance known as OPEC+, are reducing output by 1.2 million bpd from Jan. 1 for six months.
They meet on June 25-26 to decide whether to extend the pact.