OPEC+ agrees to oil output quota hike amid Hormuz blockade, Kuwait oil exports zero
New Delhi, May 3
Amid the ongoing West Asia conflict, OPEC+ countries have agreed in principle to raise oil output targets in June.
Multiple reports say that seven OPEC+ countries have agreed to raise oil output targets by about 188,000 barrels per day next month. The output hike would rather be largely symbolic until Strait of Hormuz reopens.
This will be the third consecutive monthly increase amid the geopolitical crisis and the departure of the UAE from the group.
With the UAE leaving, OPEC+ includes 21 members, including Iran.
However, only the seven nations (and the UAE) have been involved in monthly production decisions. Iran, also an OPEC+ member, has seen its own exports dwindle amid the blockade.
Crude oil output from all OPEC+ members averaged 35.06 million bpd in March, down 7.70 million bpd from February.
Last week, the UAE announced it was leaving the OPEC and OPEC+ cartels in what is seen as a major setback to the group of oil-exporting countries led by Saudi Arabia. The UAE said the decision reflected its "long-term strategic and economic vision and evolving energy profile".
The exit of the UAE is expected to weaken the oil cartel at a time when the Persian Gulf countries have taken a huge hit to their exports due to the closure of the Strait of Hormuz by an embattled Iran. The UAE accounts for around 15 per cent of the OPEC oil exports.
Reports also surfaced that Kuwait exported zero barrels of crude oil in April, a situation not seen since the 1991 Iraqi occupation, due to blockade of the Strait of Hormuz.
Kuwait Petroleum Corp declared force majeure, impacting around 2 million barrels per day. The blockade has led to a complete disruption in Kuwaiti exports.
Meanwhile, oil prices dropped after reports said Iran proposed fresh talks with the United States using Pakistan as a mediator.
West Texas Intermediate fell more than five per cent and dropped below $100 per barrel. It later recovered to $101.7.
Brent crude also fell more than three per cent to $106.98 before rising again to $108.4.
— IANS
Reader Comments
Interesting move by OPEC+. The hike is small but shows they anticipate reopening Hormuz soon. India should accelerate its renewable energy push - we can't keep being held hostage by Gulf instability.
Kuwait zero exports since 1991? Unbelievable! 😱 Those poor Kuwaitis must be in huge trouble. And Iran using Pakistan as mediator - talks with US? Let's hope Modi ji's diplomacy helps stabilize prices for India too.
UAE leaving OPEC is a big blow to Saudi influence. But I'm skeptical about symbolic output hikes - they won't help until Hormuz reopens. India needs to fast-track our strategic petroleum reserves.
Every time West Asia sneezes, India's economy catches a cold. 🥶 Our petrol prices are already at record highs. We must invest in electric vehicles and solar energy - enough of this oil dependency!
Iran-Pakistan-US talks? Sounds like drama. Pakistan can't even manage its own economy, how will they mediate? 😅 But if it leads to Hormuz reopening and lower oil prices, it's good for India.
The UAE leaving OPEC is huge - they're diversifying economically. But for Indian consumers, this geopolitical
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