Saudi Arabia and Iran are increasing oil production right ahead of a critical OPEC meeting when members are expected to discuss freezing output.
The rival producers each boosted output by more than any other nation in the OPEC group of oil exporters last month, according to a new OPEC report on world oil supplies.
OPEC is pumping out slightly more than 33.2 million barrels of crude oil per day, around its highest level ever. This has contributed to excess global supplies and caused the price of crude to drop by about 60% since mid-2014. Those low prices are, in turn, squeezing the budgets of oil rich nations.
So after months of pain, talk of a production freeze is on the table — again.
OPEC and other producers will hold an informal meeting in Algeria in the last week of September.
The oil cartel, along with Russia, is entertaining the possibility of a production cap in the hopes of putting a floor beneath low prices.