'When oil prices are so high and you're already selling a gazillion barrels, a day, why up production and let the price fall? '
OPEC and other petroleum producers are trying to play a clever game. In 1973/74 OPEC responded to Israel's victory over the Arabs by imposing an oil blockade on most of the West. The result was spiralling prices - up 400% in a year. The result was a short-term propaganda victory, followed by a Western recession, a nuclear power - errrr - boom, imposition of the 55mph limit on American freeways and Detroit's first small (relatively) cars. High oil prices also meant it was economic to develop deep water fields in the North Sea and Gulf of Mexico, which greatly reduced Western reliance on Arab oil.
Oil prices fell for the remainder of the 1970s as did the revenues to producer states. They spiked again with the Iranian Revolution and drove yet another wave of energy efficiencies in consumers and further exploration in remote areas. The end result was falling prices during which OPEC countries opened the taps to try and grab as much market share as possible - beggaring their neighbours in the process. The 1980s and early 1990s saw the World awash in cheap crude and many OPEC states reduced to basket cases with huge foreign debts.
OPEC has always tried to maintain prices in an area where they maximise incomes without provoking consumers to develop alternative energy supplies. Through the 1970s they were hugely concerned that the US would be able to develop shale oil from Colorado if oil hit $50ppb, so the target was always oil at $30ppb. In the end shale oil was an illusion - there simply isn't enough water out West to make it, but the threat was enough to drive policy.
However, this policy has come unstuck because rising demand is pushing up prices even as OPEC and non-OPEC countries announce they are hitting peak production. They can't open the taps any wider to pour more oil into the market, so the prices keep going up.
But the producers might still come out on top. With no obvious alternatives to oil, we'll keep passing our money to the Persian Gulf so they can buy our businesses. Abu Dhabi is sitting on a sovereign wealth fund equivalent to $1 million per person, and they're on a spending spree right now, with the rest of the Gulf hot on their heels. If you're in the US, it gets even worse, because the money to buy the oil is borrowed from China and has to be paid back at some time in the future.