This month, Ecuador joined a host of other OPEC countries in pumping over their production cut limit. In this segment of Industry Focus: Energy, Motley Fool energy analysts Sean O'Reilly and Taylor Muckerman talk about why, and what this is doing to the price of oil.

A full transcript follows the video.

10 stocks we like better than NOW
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and NOW wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of July 6, 2017

This video was recorded on July 20, 2017.

Sean O'Reilly: Ecuador is pumping over their OPEC limit. That's not nice, of course. This comes after, I think this came out one or two days ago, but OPEC's compliance with cuts slumped this past month. Seventy-eight percent compliance -- this is not great.

Taylor Muckerman: They're not playing nicely. That's more toward historical norms.

O'Reilly: Right. It was like they did this correctly for a couple of months -- it was 95% compliance in May -- and Algeria, Ecuador, Gabon, Iraq, UAE, Venezuela, they all started pumping, and that upset major compliance from Saudi Arabia, Kuwait, Qatar, and Angola.

Muckerman: Saudi Arabia failed to comply in June's, too.

O'Reilly: Ooh, awkward. "It was your idea, guys!"

Muckerman: Obviously, if the biggest producer fails, the smaller guys with much more reliant budgets on oil ...

O'Reilly: Hasn't Russia supposedly complied? Which, of course, begs the question, do we know? But anyway. Definitely seems like we get something that pops up that derails this production cut plan every month. It's "Oh, we have a field that does this, so we're going to produce more now," and all this stuff. And this of course brings us to the fundamental flaw of any cartel, which is you have an incentive to cheat.

Muckerman: Yeah, when it's not signed in blood.

O'Reilly: You get in a room, you agree to something, you leave the room and tell your people to do the opposite. [laughs] 

Muckerman: Yeah, exactly. Especially when you would allow Libya and Nigeria, two members, to completely remove themselves from the production cap because of internal strife.

O'Reilly: Right. "We need the money." Everybody needs money.

Muckerman: They all need the money.

O'Reilly: Interesting, because the original agreement called for, Russia was in on it, and technically Russia isn't part of OPEC, but any time OPEC makes a decision they pretty much call Putin up. They produce 10 million barrels a day, right?

Muckerman: Yeah, right in line with Saudi Aramco -- 10.5 million barrels per day.

O'Reilly: They're supposed to be doing this until March 2018.

Muckerman: They're supposed to be.

O'Reilly: It's only July 2017.

Muckerman: [laughs] Yeah, they realize it's not working.

O'Reilly: It's like they're cheating in the first quarter of the race.

Muckerman: I mean, technically they extended the cuts after they didn't work for a year.

O'Reilly: I definitely think they're expecting, the thought definitely crossed my mind, that when they cut, oil would immediately go to $60. I'm sure that's what they were hoping.

Muckerman: Fracking continued to happen.

O'Reilly: Yeah. Are we at the highest ever now? Have you seen that, U.S. production?

Muckerman: I think they're expecting to close the year around 9.6 million barrels a day.

O'Reilly: Yeah, that will be the highest.

Muckerman: And then up to 9.9 at the end of next year. Up from 8.5 last year.

O'Reilly: Yeah, and up from 4.5 10 years ago.

Muckerman: Yeah, and the rig counts more than doubled from a year ago. Still way shy -- it's in the mid-900s now, rigs on staff, and it was in the 1900s.

O'Reilly: Where are all these rigs? Are they just sitting in a field in Texas?

Muckerman: Some of them. Some of them are missing a few parts, because --

O'Reilly: I was about to say, I know they're missing a few parts.

Muckerman: -- they've been disrobed.

O'Reilly: Call up Distribution NOW. We need your parts.

Muckerman: Yeah, because rather than just taking a broken-down machine and putting a new machine there, they just take parts as they need them from these "stacked" machines, rigs. So we're still about 1,000 shy of the peak. 

O'Reilly: Where does that put us at? Six hundred, 700, and it bottomed out at --

Muckerman: No, we're in the mid-nines, and I don't know what it bottomed out at, but a year ago, they were in the mid-fours.