OPEC+ output hike faces disruption amid escalating tensions

By Abubakar Yunusa

OPEC+ is set to increase its oil production quota by 206,000 barrels per day for May 2026, despite mounting geopolitical tensions threatening global supply.
Sources familiar with the development disclosed to Reuters ahead of the group’s forthcoming meeting that eight core members had agreed in principle to replicate the production increase earlier approved for April.
However, the planned adjustment is expected to deliver minimal real impact, as the ongoing conflict involving the United States, Israel and Iran continues to disrupt oil flows across key producing regions.
The crisis has significantly constrained output from major Gulf producers, raising fresh concerns about the group’s capacity to stabilise the global oil market through quota adjustments.
Findings indicate that the Strait of Hormuz, a vital global oil transit corridor, has remained largely shut since late February, further compounding supply challenges.
Exports from leading producers, including Saudi Arabia, Iraq, Kuwait and the United Arab Emirates, have also been severely restricted.
Russia’s oil output remains under pressure, weighed down by Western sanctions and infrastructure damage linked to the ongoing war.
Although there are indications of limited transit activity resuming in some areas, uncertainty persists over how quickly production capacity and supply routes can return to normal levels.
A source noted that even in the event of an immediate resolution of the conflict, it could take several months to fully restore operations due to extensive infrastructure damage.
Analysts describe the situation as one of the most significant oil supply disruptions in modern history, with between 12 and 15 million barrels per day—approximately 15 per cent of global supply—affected.
The development comes as OPEC+ continues its phased unwinding of production cuts initiated in 2025, when it raised quotas by 2.9 million barrels per day between April and December before pausing further increases earlier this year.
For Nigeria, the unfolding scenario presents a mixed outlook.
While rising global oil prices could boost government revenues, the country’s declining production capacity limits its ability to fully capitalise on the trend.
Data shows that Nigeria’s crude output dropped to 1.31 million barrels per day in February 2026, down from 1.45 million barrels per day recorded in January.
Persistent challenges, including oil theft, pipeline vandalism and inadequate infrastructure, continue to undermine production levels.
Analysts estimate that every shortfall of 100,000 barrels per day could translate into billions of naira in lost monthly revenue, further weakening fiscal buffers and exerting pressure on the foreign exchange market.