Sources say KSA, UAE have already raised exports; oil majors, traders have suspended shipments via Hormuz
This comes after Saudi last month agreed to a surprise output cut of oil cartel OPEC, the first in eight years. PHOTO: AFP
LONDON/MOSCOW:
OPEC+ may consider a larger-than-planned output increase of 411,000 barrels per day at a meeting on Sunday, two sources close to the talks said, after Saudi Arabia and the UAE raised exports in anticipation of possible disruption to oil markets from US-Israeli strikes on Iran carried out on Saturday.
Eight members of OPEC+, which groups the Organisation of the Petroleum Exporting Countries and allies — Saudi Arabia, Russia, the UAE, Kazakhstan, Kuwait, Iraq, Algeria and Oman — were already scheduled to meet on Sunday at 1100 GMT. Despite expectations that oversupply would weigh on the market, oil prices have risen this year on fears that a conflict between Iran and the US would disrupt Middle East supply through the Strait of Hormuz. Oil hit $73 a barrel on Friday, the highest level since July.
Delegates had earlier said the eight countries would likely agree to a modest increase of 137,000 barrels per day in oil output for April, as the group readies for summer demand, led by the US driving season, and as crude prices had already risen on expectations of a US attack on Iran.
An April increase would end a three-month pause in output hikes.
Both sources, who declined to be identified by name, said an increase of 411,000 bpd — three times the volume initially floated – was now being considered. One of them said it could be even larger, at 548,000 bpd.
Output increase already under way
Evidence has mounted that the biggest Middle East producers had already boosted exports as concern built that the US would strike Iran, raising the risk of disruption of oil exports.
UAE oil producer Abu Dhabi is set to export more of its flagship Murban crude in April, two trade sources said on Friday. Saudi Arabia, the leading OPEC producer, has increased its oil production and exports as part of a contingency plan, sources told Reuters this week.
The eight OPEC+ members raised production quotas by about 2.9 million bpd from April through December 2025, roughly 3% of global demand, before pausing further increases for January to March 2026 due to seasonal weakness.
Oil, gas majors suspend shipments via Hormuz
Some oil majors and top trading houses have suspended crude oil, fuel and liquefied natural gas (LNG) shipments via the Strait of Hormuz as the US and Israel attack Iran and Tehran retaliates, four trading sources said on Saturday. “Our ships will stay put for several days,” one top executive at a major trading desk said.
The tanker association INTERTANKO said the US Navy had warned against navigation in the operations area — the whole of the Gulf, Gulf of Oman, North Arabian Sea, and the Strait of Hormuz — saying it could not guarantee the safety of neutral or merchant shipping.
Eleven LNG tankers in ballast have so far shown signs of slowing down, U-turning or stopping in or around the Strait, said Laura Page, Kpler’s insight manager, LNG and natural gas.
“This number will likely rise over the coming days and could pose risks to Qatari LNG supply to the international market,” she said.
Florence Schmit, energy strategist at Rabobank, said: “If Qatar, which plays a disproportionate role in balancing both Asian and European LNG markets, is unable to export cargoes because of infrastructure damage or shipping impairments, the effect on global gas prices would be dramatic.”
