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OPEC+ Agrees to Another Symbolic Quota Increase for July
Strait of Hormuz Remains Closed
Key Takeaways:
- OPEC+ agreed a nominal 188,000 barrel-a-day output increase for July led by Saudi Arabia and Russia despite export disruptions from the Iran war.
- The move is largely symbolic because the Strait of Hormuz blockade has stranded supply, while rising fuel costs and geopolitical tensions pressure global markets.
- The group will revisit quotas July 5 as it works to restore prior cuts, though production gains remain limited by capacity issues and ongoing conflict.
Major OPEC+ members agreed to another modest symbolic increase to their oil output quotas for July, even as a blockage of exports from the Persian Gulf prevents most of them from implementing it.
Seven nations led by Saudi Arabia and Russia will raise their collective target by 188,000 barrels a day next month, continuing the process — if only on paper — of restarting production halted several years ago, the Organization of the Petroleum Exporting Countries said in a statement on June 7 after a video conference.
With the Strait of Hormuz largely closed by the Iran war and Middle East producers forced to cut output, the OPEC+ decision remains theoretical for the time being. It could become relevant again when the waterway reopens, with buyers clamoring for barrels to replenish the world’s depleted oil inventories.
“At this stage we are basically talking about hypothetical future scenarios with the bulk of the barrels stranded,” said Helima Croft, head of commodity-markets strategy at RBC Capital Markets.
While Russian shipments aren’t directly affected by the war, its crude production has also been challenged, falling to a 10-month low in May as Ukraine intensified strikes on its oil infrastructure.
A surge in U.S. supply and diminished Chinese buying have prevented crude oil prices from spiraling out of control so far, though fuels such as gasoline, diesel and jet fuel have nevertheless surged during the conflict.
The 41st OPEC and non-OPEC Ministerial Meeting (ONOMM) was held today via videoconference under the Chairmanship of HRH Prince Abdulaziz bin Salman Al-Saud, Minister of Energy of the Kingdom of Saudi Arabia, and Co-Chair HE Alexander Novak, Deputy Prime Minister of Russian… — OPEC (@OPECSecretariat) June 7, 2026
That’s squeezing consumers worldwide and heightening the risk of an economic downturn. Still, markets haven’t rallied as much as feared while China dials back imports, major consumers tap emergency stockpiles and President Donald Trump repeatedly signals an imminent peace deal.
The seven OPEC+ nations engaged in monthly quota adjustments will next meet on July 5. Besides the Saudis and Russia, they consist of Iraq, Kuwait, Kazakhstan, Algeria and Oman.
The UAE announced its departure from the organization effective May 1, ending six decades of membership. Abu Dhabi had long been frustrated that OPEC’s quotas prevented it from deploying new investments in production capacity.
For most of the past year, key OPEC+ nations had been restoring output halted several years ago, when the alliance was trying to stave off a surplus and shore up prices. They’ve continued the process since the war started, even though the conflict prevents many of them from raising production.
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With the quota increase for July, the group will have nominally restored almost 90% of two layers of production halted in 2023. Last month, delegates said the group had a plan to complete that chunk with increases from July to September. Those supplies amounted to 3.85 million barrels a day at the time, though the volume has been reduced slightly as a result of the UAE’s exit.
A third layer, which equated to 2 million barrels a day when it was taken offline in 2022, is due to remain shut down until the end of year. Delegates said last week it could be fast-tracked, but even then most of the oil wouldn’t materialize.
Pledged supply increases over the past year have fallen significantly short of the advertised amounts as a combination of under-investment, aging oil fields and sanctions have eroded production capacity in many OPEC+ members.
The full OPEC+ coalition, which now comprises 21 countries following the UAE’s departure, will hold its next ministerial meeting on Nov. 29.
Written by Grant Smith, Fiona MacDonald, Salma El Wardany and Nayla Razzouk
