OPEC+ Plans 206,000 bpd Output Raise for May Amid Chokes Supplies

OPEC+ plans to increase its oil production quota by 206,000 barrels per day (bpd) for May 2026, sources told Reuters ahead of the group’s meeting.
Eight core members have agreed in principle to the hike, matching the April adjustment.
Yet geopolitical tensions—especially the U.S.-Israeli conflict with Iran—are curtailing its impact.
The Strait of Hormuz, a vital chokepoint for global oil shipments, has been mostly closed since late February.
This has squeezed exports from Saudi Arabia, Iraq, Kuwait, and the UAE. Russia’s production stays hampered by Western sanctions and war damage.
Even if fighting stops now, one source said full recovery could take months due to wrecked infrastructure.
However, the ongoing conflict has severely disrupted operations:

The Strait of Hormuz, a critical global oil transit route, has remained largely shut since late February
Key producers such as Saudi Arabia, Iraq, Kuwait, and the UAE have seen exports constrained
Russia’s output remains limited due to Western sanctions and war-related infrastructure damage
Despite reports of limited transit activity resuming, uncertainty remains over how quickly supply routes and production capacity can normalise.

One source noted that even if the conflict ends immediately, it could take months to restore full production levels due to infrastructure damage across the region.

The development comes amid what analysts describe as one of the largest oil supply disruptions in modern history, with an estimated 12–15 million bpd—about 15% of global supply—affected.

OPEC+ had been gradually unwinding production cuts since 2025 to regain market share, raising quotas by 2.9 million bpd between April and December 2025 before pausing increases in early 2026.

For Nigeria, the situation presents a mixed outlook:

Rising oil prices could boost government revenues
However, declining domestic production limits the country’s ability to benefit
Latest data shows:

Nigeria’s crude output fell to 1.31 million bpd in February 2026, down from 1.45 million bpd in January
Persistent issues such as oil theft, pipeline vandalism, and infrastructure gaps continue to weigh on production
Analysts estimate that every 100,000 bpd shortfall could result in billions of naira in lost monthly revenue
This production gap continues to weaken fiscal buffers and intensify pressure on Nigeria’s foreign exchange market.

While OPEC+’s planned output increase signals an intent to stabilise markets, the ongoing supply disruptions mean the policy may exist largely on paper in the short term.
Analysts call this one of history’s biggest supply shocks, hitting 12-15 million bpd, or 15 per cent of global demand. OPEC+ had eased 2.9 million bpd in cuts from April to December 2025 before pausing early this year.