Jakarta. Eight core OPEC+ producers agreed to increase oil output by 206,000 barrels per day starting May 2026, but the move is unlikely to ease market tightness as supply disruptions linked to escalating geopolitical tensions continue to dominate.

Meeting virtually on April 5, Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman approved the modest increase as part of a gradual rollback of the 1.65 million bpd voluntary cuts introduced in April 2023.

The group emphasized flexibility, saying the adjustment could be reversed “in part or in full subject to evolving market conditions,” while retaining the option to “increase, pause or reverse” production plans, including earlier cuts totaling 2.2 million bpd announced in November 2023.

The additional supply, equivalent to less than 2% of estimated disruptions, is unlikely to ease the market as the closure of the Strait of Hormuz since late February continues to choke global oil flows.

Global crude prices have surged close to $120 per barrel, the highest level in four years, pushing up fuel costs and adding pressure on businesses and consumers worldwide. The current supply shock, estimated at 12 million to 15 million barrels per day or around 15% of global supply, is among the largest on record.

The increase has yet to provide a meaningful impact on the market, as distribution constraints remain the key bottleneck while the shipping route stays disrupted.

OPEC+ also reiterated its commitment to full compliance with its production pact, with output monitored by the Joint Ministerial Monitoring Committee (JMMC), and pledged to compensate for any overproduction since January 2024.

The group warned that attacks on energy infrastructure and disruptions to key maritime routes are increasing market volatility, noting that restoring damaged facilities is costly and time-consuming, with lasting implications for global supply.

In Russia, production remains constrained by Western sanctions and infrastructure damage tied to the war in Ukraine, while in the Gulf region, missile and drone attacks have hit energy facilities, delaying recovery timelines.

Although Iran has indicated Iraqi shipments are exempt from transit restrictions in the Strait of Hormuz, shipping activity remains limited, reflecting continued caution among market participants.

The eight producers are scheduled to reconvene on May 3 to review market conditions, compliance, and compensation measures.

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