Saudi Arabia, Russia, and six other OPEC+ members announced a larger-than-expected oil production increase of 206,000 barrels per day for April amidst escalating tensions in Iran.
The Organisation of the Petroleum Exporting Countries (OPEC) stated on Sunday that the group’s decision was aimed at balancing the market, although no direct reference to the conflict in Iran was made.
Experts had predicted an increase of 137,000 barrels per day, meaning the final figure surpassed expectations. However, analysts suggest this rise is unlikely to ease concerns over soaring oil prices.
“This is a signal, not a solution. If oil cannot flow through Hormuz, an extra 206,000 barrels a day does very little to calm the market,” said Jorge Leon, an analyst at Rystad Energy.
The regional crisis has disrupted maritime transport through the Strait of Hormuz, a critical passage for around 20% of the world’s oil consumption.
Brent crude oil, the global benchmark, had already priced in growing geopolitical risk before the conflict, rising to above $72 per barrel. Prices are expected to surge sharply when markets open.
“The reality is that logistics and transit risks outweigh production targets for the time being,” added Leon.
He explained that alternative infrastructure in the Middle East could bypass the Strait of Hormuz, but the net impact remains a significant loss of about eight to ten million barrels of crude oil supply.
