Shocked oil market! Production increased in June, is Saudi Arabia angry?

On Friday, the media quoted many delegates at the meeting as saying that OPEC+ is discussing raising oil production by about 400,000 barrels in June. In response to the news, WTI crude futures fell by as much as 2.4% to $57.82 per barrel. Brent crude futures fell by about 1.7%, dropping below $61 again. Earlier that day, OPEC+ decided to hold a policy-making conference call earlier than scheduled for Monday, with a video conference scheduled for Saturday, May 3rd. Previously, OPEC+ oil-producing countries led by Saudi Arabia and Russia had already increased oil production by 411,000 barrels per day, nearly three times the original plan. This was done to restrain those member countries who were exceeding their production limits. According to delegates, the organization is considering taking the same measures next month. Saudi Arabia's policy shift was triggered by growing dissatisfaction among OPEC+ member countries such as Kazakhstan in recent months, even though Kazakhstan has repeatedly promised to comply with the agreement, it continues to severely violate the agreed limits. Most of Kazakhstan's production capacity is operated by multinational companies prioritizing expansion, and the country has a "default" attitude towards expanding oil production. The CEO of Chevron stated in a media interview on Friday that he did not discuss potential production cuts for the Tengiz oil field project in Kazakhstan during a recent meeting with Kazakh leaders, echoing similar statements from the Eni group. The latest measures to increase oil production by OPEC+ may also be welcomed by US President Trump. He had previously called for OPEC to lower oil prices and plans to visit the Middle East this month. Trump celebrated the drop in gasoline prices earlier on Friday through social media. OPEC+ has not yet made a final decision on June's production levels, and Saudi Energy Minister Abdulaziz bin Salman is known for making unexpected decisions. Recently, signals have been sent by the Saudi side to the oil industry suggesting that they are capable of withstanding a prolonged market downturn, leading to speculation that major measures may be announced by Saudi Arabia. The plummeting oil prices pose a threat to oil companies, including US shale oil producers. These companies have warned that they may not be able to respond to Trump's call for "crazy production" to achieve a new era of US energy dominance. Additionally, this also impacts OPEC+ member countries, including Saudi Arabia itself. One of the core projects of Saudi Crown Prince Mohammed bin Salman's economic transformation plan - the future city Neom - has had to reduce investments. The International Monetary Fund (IMF) lowered the economic outlook for Middle Eastern countries last week and estimated that Saudi Arabia needs oil prices to remain above $90 per barrel to meet government spending needs. Goldman Sachs expects Brent oil to push to the $40 range next year Following the news, Goldman Sachs expects OPEC+ to announce an increase of 410,000 barrels per day in June on Saturday, for a second consecutive month of supply increases of about 410,000 barrels per day. Goldman Sachs maintains its expectations for Brent crude and WTI crude to average $63 and $59 respectively by 2025, and estimates $58 and $55 respectively by 2026. Goldman Sachs continues to estimate that a global economic slowdown or a complete reversal of the plan to voluntarily reduce production by 2.2 million barrels per day by OPEC+ might push Brent crude prices down to the $40 range in 2026. In the unlikely extreme case, Brent crude prices will fall below $40. Goldman Sachs also predicts that from the second half of 2025, Iran's supply will continue to see moderate declines. This article was reprinted from "Wall Street See" written by He Hao; GMTEight Edition: Wen Wen.