By Alexander Ginting
OPEC+ will increase crude output by 411,000 barrels per day (bpd) starting in May, a move that exceeds earlier market expectations and signals the group’s readiness to respond to potential U.S. supply disruptions, according to Rystad Energy.
The increase, agreed during a meeting on Wednesday, will be implemented by eight OPEC+ producers—Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman—marking a deviation from the previously expected 135,000 bpd monthly rise. The change accelerates the unwinding of the group’s 2.2 million bpd voluntary cuts that began in April 2025 and were originally scheduled to taper off gradually over 18 months.
Rystad Energy’s head of oil markets Mukesh Sahdev said the move reflects OPEC+’s response to non-OPEC production stagnation and the risk of further supply disruptions stemming from U.S. sanctions and tariffs.
Brent crude fell by 4% following the announcement, trading below $70 per barrel on Thursday, its lowest level in weeks.
Updated production allocations for May set total OPEC-8 output at 30.96 million bpd, with Saudi Arabia and Russia producing 9.2 million and 9.08 million bpd respectively. Iraq will produce 4.05 million bpd, followed by UAE (3.02 million), Kuwait (2.44 million), Kazakhstan (1.49 million), Algeria (919,000), and Oman (768,000).
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The decision comes amid mixed global signals including uncertain demand from China, ongoing military conflict in Ukraine, and pressure from some member states seeking to align production targets with increased capacity.
Compliance remains a focus, particularly for Kazakhstan, which has overproduced in recent months. OPEC+ has called for overproducing members to submit updated compensation plans to the OPEC Secretariat by March 20 and complete production adjustments by June 2026.
According to Rystad, further output increases may depend on how the geopolitical situation unfolds, including the possibility of U.S. sanctions on Iran and continued tensions in Eastern Europe. The group also seeks to avoid flooding the market and disrupting the current backwardation in oil futures.
The May supply adjustment increases the group’s planned output return to 1.23 million bpd between May and July, suggesting further hikes could follow if macroeconomic and geopolitical conditions allow.
Rystad noted that the increase in medium sour crude—favored by global refiners—may alleviate upcoming product supply tightness ahead of summer demand, even as bearish macroeconomic factors weigh on global consumption growth.
Editing by Reiner Simanjuntak
