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OPEC to explore increase in oil production as COVID-19 measures ease

The cost of Brent Crude was close to $70 per barrel early Tuesday. File Photo by Ekina/Shutterstock/UPI
The cost of Brent Crude was close to $70 per barrel early Tuesday. File Photo by Ekina/Shutterstock/UPI

June 1 (UPI) -- OPEC and its partners were set to meet Tuesday to discuss increasing oil production, amid rising optimism that fossil fuel consumption will return to more normal levels as COVID-19 restrictions ease worldwide.

The organization, which accounts for more than a third of global oil production, and its alliance will discuss balancing oil demand and a possible output increase from Iran.

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"There are many moving parts when it comes to factors affecting the global oil market, such as the pace of change during the [COVID-19] pandemic," OPEC Secretary General Mohammad Sanusi Barkindo said in a statement on Monday.

"Given the diverse range of uncertainties, it is a tremendous source of comfort to the market that ... partners continue to be such a reliable and dependable component contributing to oil market stability."

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Mohammad called Iran, a founding OPEC member, an "extremely important and valued member" and said he expects Tehran's exports to be "orderly" and done in a "transparent fashion."

The oil consumption market has changed significantly over the past few months, when OPEC members struggled with cutting production amid sagging demand due to a year of coronavirus-related impacts.

"The market is now facing the exact opposite dilemma of April 2020," analyst Louise Dickson of Rystad Energy told Bloomberg. "Producers now have just as delicate of a task to bring back enough supply to match the swiftly rising oil demand.

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"If markets over-tighten, a flare-up in prices could jeopardize the global economic recovery."

Oil prices have risen in recent weeks with a greater return to air travel worldwide. In the United States, prices rose last week in the run-up to the Memorial Day holiday weekend.

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