Key members of the OPEC+ oil cartel announced a greater-than-expected increase to production quotas on Sunday following US and Israeli strikes on Iran that triggered retaliation by Tehran across the Middle East.
The eight-strong V8 (Voluntary Eight) group in the alliance, which includes key oil producers Saudi Arabia and Russia—as well as several Gulf states bearing the brunt of Tehran’s missile strikes—said they had agreed a “production adjustment” of 206,000 barrels per day (bpd).
“This adjustment will be implemented in April,” they said in a statement.
The text did not explicitly mention the outbreak of the Iran conflict, instead citing “a steady global economic outlook and current healthy market fundamentals” as its reasons for the increase.
Before the weekend’s meeting, experts had forecast a more modest increase of 137,000 barrels per day.
But Jorge Leon, an analyst at Rystad Energy, warned the agreed-upon increase was potentially not large enough to prevent the Iran conflict from causing a spike in oil prices when trading opens on Monday.
Leon pointed to the possibility that Iran could target the Strait of Hormuz, a key waterway through which around nearly a quarter of the world’s seaborne oil supplies pass, in retaliation.
