OPEC+ reported that the maximum production quota for oil has been raised by 206,000 b/d for May at the conclusion of the meeting held on 5 April. This aligns with the increase implemented in April. As with the previous month, the quotas for both Russia and Saudi Arabia have been raised by 62,000 b/d each. For Russia, the maximum oil production level for May has been set at 9.69 million b/d, while for Saudi Arabia it has been set at 10.22 million b/d. Quotas for Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman have also been increased by the same amount as in April.
OPEC+ has indicated that it will continue to assess market conditions, emphasising the importance of a cautious approach to altering quotas. Furthermore, the alliance expressed concerns about attacks on energy infrastructure, noting that the restoration of damaged facilities will be a costly and protracted process. Any actions undermining the security of energy supplies, including attacks on infrastructure or disruptions to international maritime logistics, increase market volatility, according to OPEC+'s statement. The next meeting of the alliance is scheduled for 3 May 2026.
OPEC+ has maintained its pace of quota increases amidst oil supply disruptions due to the ongoing military conflict in the Middle East. According to data from Kpler, the supply of crude oil has diminished by more than 130 million barrels within the first three weeks of the military actions. By the end of March, total losses could exceed 250 million barrels, and by the end of April—600 million barrels—if supplies do not resume.
Sergey Tereshkin, General Director of Open Oil Market, points out that leading oil-producing countries in the Middle East are unable to provide a sharp increase in supply "here and now." Hence, he remarks, OPEC+ has made an "interim" decision to raise quotas to a realistic market figure that can be met in the event of an improvement in shipping conditions through the Strait of Hormuz. This suggests a maintenance of the status quo for the market: the Brent price will likely continue to hover around $110 per barrel. Post-conflict, alliance countries will be able to increase supply without exceeding their quotas, Mr. Tereshkin continues.
Andrey Polischuk, a senior analyst in the oil and gas sector at Euler, states that more radical measures could lead to a surplus following the normalisation of the situation in the Strait of Hormuz. Igor Yushkov, an expert at the Financial University under the Government of the Russian Federation, adds that OPEC+'s decision to raise quotas, when many countries in the Persian Gulf cannot fully utilise them, indicates the alliance's desire to demonstrate control over the situation. However, he cautions that the longer the conflict continues, the greater the damage to the region's oil infrastructure, raising questions about how much crude could realistically be exported once the Strait of Hormuz reopens.
Nonetheless, Kirill Bakhtin, head of the analytics centre for Russian stocks at BCS World of Investments, believes that the prospects for increasing production are favourable due to the rise in oil prices since February, provided it is confirmed that the damage from recent attacks on ports in the Leningrad region was minimal. "An increase in production will help attract additional revenue for both companies and the Ministry of Finance," notes Sergey Tereshkin.
According to S&P Global Commodities at Sea, in the last week of March, Russia cut its maritime oil exports from Ust-Luga by 4.5 times to 105,000 b/d and from Primorsk by one-third to 730,000 b/d. Overall shipments for the month decreased by less than 1% compared to February, to 3.46 million b/d.
Source: Kommersant
