The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, has decided to raise its oil production quotas for May by 206,000 barrels per day (bpd), continuing a cautious increase amid ongoing market uncertainty.
The announcement came after a virtual meeting of key members including Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman. OPEC+ said the increase is aimed at supporting market stability as global oil markets face disruptions due to geopolitical tensions.
However, the cartel warned that actual output might not rise fully. Damage to energy infrastructure and the closure of the Strait of Hormuz, a vital oil shipping route, have limited the ability of some countries to export crude. Repairs to damaged facilities are expected to be expensive and take time, adding to supply risks.
The Strait of Hormuz, through which a significant portion of the world’s oil passes, has been affected by regional conflicts, reducing the practical supply even if quotas are raised.
Global oil prices have already been responding to these risks. Brent crude has been trading near $120 a barrel, pushed higher by fears of disrupted shipments and damaged infrastructure. Analysts warn that without improvements in supply flow, prices could remain elevated.
OPEC+ emphasized the importance of protecting shipping routes and energy infrastructure to keep oil flowing smoothly to international markets. While the quota increase signals readiness to produce more, the group said it will continue to monitor supply conditions and adjust output if needed.
The cartel’s monitoring committee will next meet in June, but OPEC+ remains prepared to convene sooner if market conditions change unexpectedly.