OPEC+ to discuss oil production rise as Iran war weighs on markets

VIENNA, Austria: Key members of the OPEC+ oil cartel will on Sunday discuss production quotas for next month as the US-Israeli war against Iran unsettles global oil markets.

The eight-strong V8 (Voluntary Eight) group in the alliance, which includes top oil producers Saudi Arabia and Russia — as well as several Gulf states who have been hit by Iran’s retaliatory airstrikes — are to decide whether to increase production as prices rise.

Last month, the group announced a higher-than-expected increase in production quotas by 206,000 barrels per day (bpd).

Since the war started on February 28, Iran has virtually closed off the crucial Strait of Hormuz. Before the war, about a fifth of global oil and liquefied natural gas (LNG) passed through the Strait.

The war has all but halted shipments of about one-fifth of the world’s oil and liquefied natural gas through the Strait of Hormuz.

“Even with a possible decrease in tensions we expect a ‌price floor ⁠of $85–$90 and a natural drift back to the $110 range until the Strait of Hormuz is restored,” Macquarie said in a client note.

If the strait remains effectively shut until the end of April, Brent could still reach $150 a barrel, Macquarie said.

To ease supply shortage, the U.S. temporarily waived sanctions on Russian and Iranian oil already at sea. Industry sources said ​traders have since offered Iranian crude to Indian refiners at a premium to ICE Brent.

Oil executives ​and energy ministers at a conference in Houston flagged the longer-term impact of the U.S.–Israel war with Iran on the global economy.