Opec+ overproducers update compensation plans

Six of the eight Opec+ members that are unwinding production cuts have submitted updated schedules for how they plan to compensate for exceeding crude output targets since the start of 2024.

The schedules, published by Opec, show that Kazakhstan, Iraq, Russia, the UAE, Kuwait and Oman plan to produce around 434,000 b/d below their combined targets on average between August this year and June 2026 (see table).

Most of this compensation is scheduled for 2026, led by significant cuts from top overproducer Kazakhstan.

The six countries overproduced by a cumulative 4.779mn b/d between January 2024 and July 2025, according to Opec. This figure is the sum of monthly overproduction volumes, not a monthly average. It equates to an average monthly overproduction of 252,000 b/d.

This marks an improvement in compliance since the previous compensation schedule published in April, which showed average monthly overproduction of 305,000 b/d.

Key overproducers Iraq and Russia have made progress compared with that earlier plan, although Kazakhstan's compliance has worsened despite repeated pledges to lower output, the data show.

The latest plan confirms that Saudi Arabia has fully compensated for its past overproduction. Algeria also has no overproduction to address.

The eight producers are this month unwinding the final increment of a 2.2mn b/d cut agreed in November 2023. They have also agreed to begin unwinding another layer of cuts worth 1.65mn b/d from October.

The group expects that its compensation pledges will partially offset the impact of continuing to unwind production cuts.

By Aydin Calik