The OPEC+ oil cartel said over the weekend that several members will ramp up production for the third consecutive month in another potential hit to a struggling U.S. oil industry being hurt by low prices and tariffs making it more expensive to operate.

The group, which supplies about half of the world’s oil, said some of its members would ramp up production amounting to an additional 411,000 barrels per day for July. The move was widely expected by analysts but comes at a time of tepid demand because of economic uncertainties from tariffs and the resulting trade wars and costs hovering around $60 a barrel.

In a release, OPEC+ said a “steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories” supported its July increase. Analysts said it is likely the group will not reach its additional quota but the addition of supply to the market could still affect American producers, who have higher costs for production than OPEC counterparts.

Saudi Arabia and Russia are trying to win back market share through increased production, with the Saudis receiving the biggest share of the latest increases, ramping up its ceiling to around 9.5 million barrels a day.

President Donald Trump has also tried to forge more productive business relationships with major oil producers, including Saudi Arabia, and recently took a trip to the Middle East where he announced a series of business deals.

“President Trump has asked for it, he’s cut some commercial deals with the leading members of OPEC, No. 1. No. 2, a lower oil price is very effective in limiting the hard currency that Russia and Iran can obtain,” said Ed Hirs, an energy fellow at the University of Houston. “It’s in the interest of the Saudis right now because their concern really is Iran becoming a nuclear power right now. It’s not just Israel; it’s the Saudis and nations in the Persian Gulf.”

Lower oil prices are a boost for consumers, who will see prices ease at the pumps and on their utility bills, and for Trump’s push to lower inflation through reduced energy costs. Trump came into office promising to “unleash” U.S. energy production and has pushed companies to drill more through executive orders reducing required time for environmental reviews and cutting other regulations aimed at helping increase production.

America was already the world’s largest exporter of natural gas and produced more oil than any other country before the actions, and now U.S. companies are facing economic headwinds that are reducing incentive to continue high production levels. U.S. oil production hit a record high of 13.4 million barrels a day last year.

Tariffs are the main obstacle for American oil producers with uncertainty about where import taxes are headed weighing on economic activity and making it challenging for companies to plan for. Economists are projecting reduced demand for oil this year because of Trump’s expansive tariffs, leaving American producers less revenue and incentive to continue drilling.

Tariffs on steel, which Trump announced he would be doubling to a 50% on Friday, are also putting a dent in oil companies’ profit margins. Some smaller companies have already rolled back plans to drill and laid off workers.

The International Energy Agency is expecting production in the United States’ shale basins, where most of the country’s oil is produced, to fall later this year. Those losses could ramp up if oil prices fall under $60 a barrel, though the market it is entering a period that typically comes with higher demand as people drive more often in the summer and use air conditioning.

Future prices for Brent crude and West Texas Intermediate opened higher on Monday after OPEC’s announcement, but analysts see that as a trend unlikely to continue.

“If you keep driving down the revenues, that’s going to certainly diminish any incentive to drill, you just can’t make a return,” Hirs said. “The U.S. producers in these tight horizontal formations the shales, the Permian, these wells are expensive, and we can’t compete on a low-cost basis with the other major producers like Russia, Saudi Arabia, Iran, Kuwait, Western African nations.”

Have a news tip? Contact Austin Denean at atdenean@sbgtv.com or at x.com/austindenean.