OPEC+ Agrees to Modest Output Increase Amid Oil Supply Disruptions

By Ginika Igboke 

The international oil alliance OPEC+ announced on April 5 that it will increase oil production quotas by 206,000 barrels per day in May, as several member countries struggle to boost output during the ongoing U.S.–Israeli conflict with Iran.

The decision comes as Iran continues to restrict access through the Strait of Hormuz, a critical global oil transit route, following coordinated U.S. and Israeli strikes launched on Feb. 28. Tehran has also carried out retaliatory missile and drone attacks targeting key energy infrastructure across the Persian Gulf.

Strait Closure Drives Global Oil Price Surge

The Strait of Hormuz, widely regarded as the world’s most vital oil shipping lane, has been effectively closed since the conflict began. This has forced major producers—including Saudi Arabia, the United Arab Emirates, and Iraq—to scale back exports despite being among the few OPEC+ members previously capable of increasing production.

Oil markets have reacted sharply. U.S. benchmark West Texas Intermediate crude rose 9.2 percent to $109.35 per barrel on April 2, following signals of escalation in the conflict. By April 5, prices climbed further to $111.54 per barrel, while some international benchmarks, such as the Indian Basket, exceeded $120 per barrel.

The surge in oil prices has led to higher transportation fuel costs, putting pressure on global supply chains as well as consumer and business travel.

Limited Impact of Production Increase

The planned increase of 206,000 barrels per day represents less than 2 percent of the supply disrupted by the closure of the Strait of Hormuz, highlighting the limited ability of OPEC+ to offset the shortfall.

The agreement was reached during a virtual meeting involving key members, including Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman. In a joint statement, the group emphasized a cautious approach, noting that production levels could be adjusted depending on evolving market conditions.

Infrastructure Damage and Sanctions Constrain Output

Beyond the Gulf states, other OPEC+ members are also facing production challenges. Russia, for example, has struggled to increase output due to Western sanctions and infrastructure damage linked to its ongoing war in Ukraine.

Meanwhile, Gulf nations have sustained significant damage to oil facilities from Iranian strikes. Officials say it could take months to restore full production capacity, even if hostilities end and the Strait of Hormuz reopens.

Concerns Over Energy Security and Market Stability

A separate OPEC+ body, the Joint Ministerial Monitoring Committee, also met on April 5 and voiced concern about the impact of attacks on energy infrastructure.

The committee warned that disruptions to oil facilities and international shipping routes threaten global energy security, increase market volatility, and undermine coordinated efforts to stabilize supply.

At the same time, member countries acknowledged efforts by some producers to maintain supply through alternative export routes, which have helped ease some pressure on global markets.

Ongoing Cooperation to Stabilize Markets

The actions are being taken under the framework of the OPEC Declaration of Cooperation, a 2016 agreement between OPEC members and allied producers aimed at coordinating output to stabilize global oil markets.

Despite the current challenges, OPEC+ signaled it remains committed to maintaining flexibility and responding to shifting conditions as the conflict continues to impact global energy supply.