OPEC+ Hikes Oil Quotas by 188,000 BPD Amid UAE Exit
OPEC+ increased its oil production quota by 188,000 BPD for June, a move by seven major producers to signal continuity after the UAE's withdrawal. The decision aims to stabilize markets but faces limitations from current production shortfalls and the Strait of Hormuz blockade.
Seven major OPEC+ producers, including Saudi Arabia and Russia, increased their collective oil production quota by 188,000 barrels per day (BPD) for June. This move aims to demonstrate continuity after the United Arab Emirates (UAE) withdrew from the group, effective Friday.
The statement from OPEC+ made no mention of the UAE's departure. The increase, similar to previous adjustments subtracting the UAE's portion, was widely anticipated by analysts. However, the actual impact on physical supply may be limited, as current production already falls short of the limit and exports from the Gulf region are constrained by Iran's blockade of the Strait of Hormuz, imposed in response to US-Israeli strikes that began February 28.
Jorge Leon of Rystad Energy noted that this increase is a two-fold message: that the UAE's exit will not disrupt OPEC+ operations and that the group maintains control over global oil markets despite war-related trade disruptions. The UAE, a top producer, announced its withdrawal on April 28 due to dissatisfaction with production quotas.