OPEC+ struggles to fill the gap as April output hits 35-year low

The Organization of the Petroleum Exporting Countries is facing an existential test. April 2026 marked the lowest monthly OPEC output in more than three decades — 20.18 million barrels per day, according to IEA data cited by TASS — as the Iran war and the closure of the Strait of Hormuz effectively sidelined the world's most important oil-producing bloc at the moment of greatest need.

A historic collapse. The Iran war wiped out 7.88 million bpd of OPEC's production in March, a 27% monthly decline. Combined OPEC+ output fell by 1.74 million bpd month-on-month in April to 33.19 million bpd, with production losses across six Middle East Gulf members totalling nearly 1.9 million bpd in a single month. Total oil production in the Persian Gulf countries, including Qatar, dropped by 14.4 million bpd — or 45% — since the start of the conflict, standing at just 17.6 million bpd in April.

OPEC+ supply from countries outside the Gulf managed marginal increases in April, but these were insufficient to offset the collapse at the alliance's core. The IEA reports that OPEC+ oil supplies fell by 830,000 bpd in April to 34.1 million bpd due to lower Gulf output, even as non-Gulf members like Nigeria and Libya registered small gains.

The June easing: a drop in the ocean. On May 3, seven core OPEC+ members — Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman — agreed to raise collective production targets by 188,000 barrels per day in June. This was the first output adjustment since the war began, and the group's first official meeting since the UAE formally left OPEC on May 1, ending more than five decades of membership.

FACT: The 188 kb/d June increase represents roughly 0.5% of the production capacity that has been sidelined by the Hormuz crisis. Even if the entire increase could be physically delivered — and for Gulf members still blocked from exporting, that is far from guaranteed — it would fill less than two days of the global inventory deficit.

The group said the rollback could be paused, reversed, or accelerated depending on market conditions. Four sources told Reuters that seven leading OPEC+ countries will likely consider another modest hike to July output when they meet on June 7, though delivery for several remains disrupted by the Iran war. The reality is that OPEC's Gulf members cannot pump what they cannot ship.

Banks raise forecasts. Major investment banks are recalibrating their oil price outlooks to reflect the depth and likely duration of the supply gap. Barclays lifted its 2026 Brent crude oil price forecast to $100/bbl from $85 earlier, with risks "skewing higher," noting that inventory trends are signalling a 6–8 million bpd deficit and that US inventories are within reach of the lowest levels since 2020. HSBC raised its Brent forecast to $95. BMI, a unit of Fitch Solutions, raised its average 2026 dated Brent forecast to $90 from $81.50.

Saudi Aramco CEO Amin Nasser delivered perhaps the most sobering assessment, warning that a return to market stability could take until 2027. His ADNOC counterpart in the UAE echoed this timeline, stating that full oil flows through the Strait will not return before the first or second quarter of 2027 even if the conflict ends immediately.

The UAE exit adds structural uncertainty. The UAE's departure from OPEC — a decision three years in the making, according to a senior presidential adviser — came at a critical juncture. The UAE cited a growing mismatch between its rising production capacity and the quotas it was permitted under the OPEC framework. The country, the world's seventh-largest oil producer, has invested heavily in expanding capacity to 5 million bpd or more, but faced constraints under the alliance's output-sharing system.

The adviser said the UAE views the world as nearing the "autumn of the hydrocarbon age," meaning the country needs to maximise oil revenues while it can. The exit raises questions about the future cohesion of the broader OPEC+ alliance and its ability to coordinate output policy through future supply crises.

Can OPEC+ recover? Even if the strait reopens, OPEC faces immense challenges in restoring production: damaged infrastructure in several Gulf states will require months or years to repair; workforce displacement and supply chain interruptions have disrupted operations; and the political fallout from the war may permanently alter production-sharing arrangements. For the foreseeable future, OPEC+ is a cartel with ample nominal capacity but severely limited effective capacity — and the market is repricing accordingly.