OPEC+ agreed on Sunday a fourth
increase in its oil output targets in as many months, even
though the US war with Iran is still preventing several of the
group’s members from pumping more.
The war has cut oil flows via the Strait of Hormuz, creating
the world’s biggest-ever supply crisis as key OPEC+ members
including Saudi Arabia have been unable to supply customers in
full since the end of February. The crisis for OPEC+ deepened
when the United Arab Emirates left the Organization of the
Petroleum Exporting Countries after almost 60 years.
Seven core members of OPEC+, which groups OPEC and allied
producers including Russia, have increased their output quotas
from April to June by almost 600,000 barrels per day.
IMPACT OF PRODUCTION TARGET INCREASE
In reality, the group’s production has collapsed due to
export cuts by Gulf members, averaging 33.19 million bpd in
April compared with 42.77 million in February, according to OPEC
figures.
On Sunday, the seven members decided to increase targets by
188,000 bpd from July, OPEC said in a statement. This is the
same as the June hike, which was adjusted down from monthly
increases of 206,000 bpd in May and April to take into account
the UAE exit.
“An OPEC+ production increase means very little while the
Strait of Hormuz remains closed,” said Jorge Leon, an analyst at
Rystad and a former OPEC official.
“When the Strait of Hormuz reopens, the market could move
very quickly from fear of shortage to fear of surplus.”
On Friday, oil prices fell to around $93 a barrel
as traders gained confidence that renewed conflict between the
U.S. and Iran was growing less likely. Prices were close to $72
before the war began.
OPEC+ ALMOST DONE WITH UNWINDING 2023 OUTPUT CUT
The seven countries are increasing production as part of the
gradual unwinding of a 1.65 million bpd production cut that the
group, which at the time included UAE, agreed in 2023.
From July, the seven have about 567,000 bpd of the original
cut to return to the market, taking into account the UAE exit
from May 1, according to Reuters calculations.
That would mean the rest of the cut will be unwound by the
end of September should OPEC+ stick to monthly hikes of about
188,000 bpd for August and September.
The seven of 21 OPEC+ members who met on Sunday are Saudi
Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia and Oman. In
recent years, only the seven plus the UAE – when it was a member
– have been involved in the group’s output policy decisions.
In a separate meeting on Sunday of all OPEC+ members, the
ministers made no change to group-wide output policy that is in
place until the end of 2026, OPEC+ said in another statement.
OPEC+ is carrying out a review of its members’ oil
production capacity to be used as a reference for 2027
production baselines, from which quotas are set. The group on
Sunday affirmed the importance of completing the assessment, the
statement said.
Published on June 7, 2026
