OPEC+ is set to consider a May production quota increase on Sunday that sources say will be largely symbolic while the region remains unable to resume normal exports. Four people within the group told Reuters that the measure under discussion would signal a readiness to lift output in the future but would have limited immediate impact on global oil supply.
The group faces severe physical constraints. The U.S.-Israeli war with Iran has effectively closed the Strait of Hormuz - the world's most important oil transit route - since the end of February, cutting exports from the Gulf producers inside OPEC+ that had the most spare capacity. Saudi Arabia, the UAE, Kuwait and Iraq were the only members in the group capable of significant production increases even before the conflict intensified, and their flows have been curtailed by the disruptions to Hormuz.
Beyond the Gulf, other OPEC+ participants cannot meaningfully increase output. Russia remains restricted by Western sanctions and by infrastructure damage suffered during its war with Ukraine. Inside the Gulf, missile and drone attacks have inflicted serious damage to oil infrastructure; Gulf officials have told delegates that it would take months to restore operations and achieve production targets even if hostilities ceased and the Strait of Hormuz were reopened immediately.
At the OPEC+ meeting on March 1, held as the conflict began to choke oil movements, the group agreed a modest aggregate increase of 206,000 barrels per day for April. Since then, the disruption to global oil flows has widened dramatically. Analysts estimate the supply shock to be the largest on record, removing as much as 12 to 15 million barrels per day - up to roughly 15% of worldwide supply.
The market reaction has been pronounced. Crude futures have surged to a four-year high, approaching $120 a barrel. Forecasts from major banks warn of further upside: JPMorgan said on Thursday that prices could spike above $150 a barrel if the Strait of Hormuz remains impassable into mid-May.
Sunday's session will focus on OPEC+ quotas for May, delegates said. While an approved increase would do little to replenish physical supplies immediately, sources inside the group say it would serve as a formal indicator that producers are prepared to raise output once transit routes and facilities are functioning again. Consultancy Energy Aspects described such an increase as "academic" while disruptions in the strait persist.
Context and implications
The measures under consideration by OPEC+ reflect the distinction between policy signaling and practical capacity. Approving higher quotas can reassure markets that producers are willing to act when logistical and security conditions allow, but it cannot substitute for the ability to physically move crude to market while the Strait of Hormuz remains closed and key facilities are damaged.
For traders, refiners and energy-dependent sectors, the prevailing constraint is the physical bottleneck and the timeline for repairing infrastructure and reopening transit routes. Even if political or military developments reduce immediate hostilities, Gulf officials have warned that restoring full production will require months, limiting the near-term effectiveness of any paper-based quota decision.