Opec+ has agreed in principle to keep its official targets unchanged while discussing a potential “paper” increase in quotas for May, with the Joint Ministerial Monitoring Committee stopping short of indicating any increase in production capacity, as the alliance balances tightening supply conditions against heightened geopolitical risks in the Middle East.
Delegates said the group is considering a largely symbolic adjustment to baseline quotas that would not translate into meaningful additional barrels.
The group had agreed last month to increase output by 206,000 barrels per day from April, following one of the alliance's most consequential meetings in years.
Yet the group's stark warning on energy security, and its acknowledgement that damaged infrastructure cannot quickly be brought back online, underscore the limits of its ability to deliver additional supply, despite indicating flexibility on paper.
“Restoring damaged energy assets to full capacity is both costly and takes a long time, thereby affecting overall supply availability,” the group said on Sunday.
The decision by the group, which comprises Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Nigeria, Algeria and Venezuela, demonstrates its cautious approach as oil prices surge and supply disruptions persist.
It comes as oil markets remain volatile following a sharp rally last month, when prices posted one of their strongest monthly gains in recent years, driven largely by disruptions linked to the Iran conflict and uncertainty surrounding key shipping routes.
In its latest meeting, the JMMC instead focused on supply risks, warning that attacks on energy infrastructure and disruptions to maritime routes are undermining market stability.
The committee also repeated the “essential role” of the Declaration of Co-operation in supporting market stability and stressed the need for full adherence by participating countries to agreed production levels.
It added that countries exceeding their quotas must submit updated compensation plans, reinforcing Opec+’s continuing efforts to improve compliance across the alliance.
The impact of any new quota adjustment is already being limited by continuing supply disruptions across the Gulf, with some production and export flows still constrained, as multiple major energy producers have had to cut their output levels drastically or declare force majeure.
The committee also stressed the importance of safeguarding key maritime routes, as disruptions to international shipping lanes risk tightening global supplies and amplifying volatility.
In the middle of last month, the US made its own move to rebalance energy market supplies by announcing plans to release 172 million barrels of oil from its strategic petroleum reserves in an effort to lower energy prices.
The announcement followed a similar one from the International Energy Agency, in which member nations agreed to a co-ordinated release of 400 million barrels of oil from their reserves.
Oil prices have remained elevated this month amid fears of prolonged disruption to flows through the Strait of Hormuz, a critical artery that typically carries about a fifth of global oil supply.
The waterway has become a focus for market concerns as tension in the region continues, with traders closely monitoring developments for signs of further escalation.
The Iran conflict has emerged as the dominant driver of oil markets, disrupting shipping routes and limiting production capacity across several key producers.
Brent, the benchmark for about two thirds of the world’s oil, rose 7.78 per cent to settle at $109 a barrel on Friday. West Texas Intermediate, the gauge that tracks US crude, leapt 11.41 per cent to close at $111.50 a barrel.
The sharp swing in crude prices, which rose a record 60 per cent last month, followed an address by US President Donald Trump last week that was expected to calm markets but instead increased concerns, after he said Washington would hit Iran “extremely hard” in the next two to three weeks and send it to the “Stone Ages”.
Uncertainty surrounding the situation is expected to keep a geopolitical risk premium embedded in prices for an extended period, leaving Opec+ with a delicate balancing act between indicating readiness to stabilise markets and recognising the physical constraints on supply.
The next meeting is scheduled for June 7 this year.
