OPEC+ Considers Larger Oil Output Hike Amid Iran Tensions
OPEC+ could consider increasing oil production beyond its previously planned levels when key producers convene on Sunday, according to Reuters. This potential move comes as Gulf exporters seek to cushion global markets from possible supply disruptions following recent US-Israeli strikes on Iran. Two sources close to the talks, who requested anonymity, revealed that the alliance is discussing this expanded output strategy.
Meeting of Key Producers Scheduled
Eight members of the oil alliance—Saudi Arabia, Russia, the United Arab Emirates, Kazakhstan, Kuwait, Iraq, Algeria, and Oman—are scheduled to meet at 1100 GMT to review production levels. This gathering occurs against a backdrop of heightened geopolitical uncertainty in the Middle East.
Earlier indications from delegates suggested that OPEC+ would likely approve a modest increase of 137,000 barrels per day for April. This proposed hike was intended to prepare for stronger summer demand, particularly from the US driving season, and would have marked the end of a three-month pause in output increases.
Shift in Strategy After Iran Strikes
However, following the strikes on Iran, the possibility of a larger production increase is now being actively discussed. One source noted that while the size of any additional hike has not yet been determined, the alliance is considering expanding output beyond the initial plan. Bloomberg News had earlier reported that OPEC+ would contemplate a bigger production increase, citing a delegate familiar with the discussions.
Oil Prices Defy Oversupply Concerns
Despite earlier expectations that oversupply could pressure prices downward, crude oil has rallied significantly this year. Markets have been pricing in the risk that escalating conflict between Iran and the US could disrupt Middle East shipments through the critical Strait of Hormuz. On Friday, oil reached $73 per barrel, its highest level since July, demonstrating how geopolitical tensions are outweighing traditional supply-demand dynamics.
Gulf Exporters Already Increasing Shipments
Market signals indicate that some producers have already begun stepping up exports in anticipation of potential supply disruptions. Trade sources informed Reuters that Abu Dhabi is set to export higher volumes of its flagship Murban crude in April. Additionally, Saudi Arabia has increased both production and exports as part of contingency planning linked to concerns that escalating regional tensions could affect oil flows, according to sources earlier this week.
Background on OPEC+ Production Policies
The eight OPEC+ members had previously raised production quotas by approximately 2.9 million barrels per day from April through December 2025. This increase represented roughly 3 percent of global demand. The alliance then paused further increases for January through March 2026 due to seasonal weakness in the market.
The outcome of Sunday's meeting is expected to signal how OPEC+ balances geopolitical risk with supply management as global oil markets remain on edge. The decision will reveal whether the alliance prioritizes market stability through increased production or maintains a more cautious approach amid ongoing Middle East tensions.
