8 OPEC Plus Countries Raise Oil Production Output Target For May As Iran War Continues To Fuel Volatility

The Organization of the Petroleum Exporting Countries and its allies have decided to raise oil production quotas for May 2026, even as global markets remain unsettled by the ongoing conflict in the Middle East.

Eight key producers i.e Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria and Oman - held a virtual meeting on April 5 to review market conditions. The group agreed to increase output by 206,000 barrels per day in May as part of a gradual rollback of the 1.65 million barrels per day voluntary cuts first introduced in April 2023.

The increase is being led by Saudi Arabia and Russia, both of which will add 62,000 barrels per day. Iraq will contribute 26,000 barrels per day, while the UAE will add 18,000 barrels per day. Kuwait, Kazakhstan, Algeria and Oman are making smaller additions under the same framework. The group has kept the rollback flexible, making it clear that further adjustments will depend on how the market evolves.

Prices Stay High Despite The Move

This decision comes at a time when oil prices remain elevated. Brent crude is trading close to $109 per barrel, reflecting sustained pressure on global supply. The conflict in the Middle East has now stretched into its fifth week, disrupting flows from the Persian Gulf and pushing up the cost of fuels such as diesel and jet fuel.

These price pressures are beginning to raise broader concerns about inflation, particularly as energy costs feed into transportation and manufacturing sectors across economies.

Limited Immediate Impact On Supply

Even with higher quotas, the actual increase in supply may not be significant in the near term. Several OPEC+ members are already producing below their assigned targets due to capacity constraints and ongoing disruptions. This means that the revised quotas may not translate directly into higher output.

At the same time, exports from the region remain restricted, and logistical challenges continue to weigh on shipments. Rising freight and insurance costs have added another layer of difficulty for producers trying to move crude to global markets.

Strait of Hormuz Remains Under Watch

A major source of concern continues to be the Strait of Hormuz, a crucial route for global oil trade. Disruptions along this narrow passage have affected tanker movement, creating uncertainty among traders and tightening supply expectations.

The situation has been further intensified by statements from Donald Trump about escalating the conflict, raising fears that supply disruptions could persist longer than anticipated.

The latest move by OPEC+ appears to be more about signalling intent than delivering immediate relief. The group is positioning itself to gradually restore production if conditions improve, while still maintaining control over supply in a volatile environment.

For now, global oil markets remain heavily influenced by geopolitical developments rather than production policy alone.