STORY: Saudi Arabia and other OPEC+ states agreed to increase oil production Thursday to offset the loss of Russian oil, in hopes of easing surging oil prices and global inflation, and to smooth the way for an ice-breaking visit to Riyadh by U.S. President Joe Biden.
The move is seen as a sign of willingness by Saudi Arabia and other OPEC Gulf nations to pump more after months of pressure from the West to address global energy shortages worsened by Western sanctions on Russia.
OPEC+ said it agreed to boost output by 648,000 barrels per day in July - and a similar amount in August.
But oil rose on the news towards $117 a barrel as analysts said the real production boost will be insignificant, as most OPEC members - aside from Saudi Arabia and the United Arab Emirates - are already pumping at capacity. Earlier this year, oil came close to an all-time peak of $147 a barrel hit in 2008.
The Organization of the Petroleum Exporting Countries and other producing nations, includes Russia, whose output has fallen by about 1 million barrels per day following sanctions on Moscow over its invasion of Ukraine.
The news comes ahead of a critical visit to the Middle East for President Biden.
U.S. diplomats have worked for weeks organizing Biden's first visit to Riyadh after two years of strained relations due to disagreements over human rights, the war in Yemen and the 2018 killing of U.S. based Saudi journalist Jamal Khashoggi - a murder which U.S. intelligence has accused Saudi Crown Prince Mohammed bin Salman of approving - a charge the prince denies.
The White House said it welcomed Thursday's decision and recognized the role of Saudi Arabia in achieving OPEC+ consensus.