Oil Market on Edge as OPEC+ Weighs Bigger April Output Hike After Iran Tensions
OPEC+ is weighing a faster return of supply to the global oil market as geopolitical tensions in the Middle East intensify.
Key Takeways
- OPEC+ is considering a larger-than-planned oil output increase for April after geopolitical tensions involving Iran pushed prices to seven-month highs.
- The group was initially expected to raise production modestly by 137,000 bpd, but conflict risks and a $10 per barrel geopolitical premium have opened the door to a bigger supply boost.
- Brent crude recently climbed near $73 per barrel, while major banks warn prices could range from $80 to as high as $130 in extreme disruption scenarios.
The alliance’s eight core producers are set to meet online on March 1 at 11:00 GMT, and discussions are now centered on whether April output should rise more aggressively than previously planned.
Until recently, the group was expected to move cautiously, restoring just 137,000 barrels per day (bpd) after pausing increases during the first quarter of 2026. That plan was designed to navigate seasonal demand weakness and avoid pressuring prices. However, U.S.-Israeli military strikes on Iran have changed the equation, pushing the alliance to consider a larger supply boost to counter potential disruptions.
A Shift From Modest to Meaningful
Between April and December 2025, the eight core members – Saudi Arabia, Russia, the UAE, Iraq, Kuwait, Kazakhstan, Algeria and Oman – collectively raised quotas by around 2.9 million bpd, equivalent to roughly 3% of global oil demand. After freezing further hikes for January through March, the group now faces renewed pressure to act.
Brent crude climbed to a seven-month high near $73 per barrel on February 27 as traders priced in elevated regional risks. Analysts estimate that geopolitical tensions alone have embedded a risk premium of about $10 per barrel into current prices.
If OPEC+ opts for a larger-than-expected increase in April, it would formally end the first-quarter pause and signal a willingness to stabilize markets before the peak summer driving season.
Current Production Quotas
As of March 2026, the eight core members operate under the following quotas:
- Saudi Arabia – 10.103 million bpd
- Russia – 9.574 million bpd
- Iraq – 4.273 million bpd
- UAE – 3.411 million bpd
- Kuwait – 2.580 million bpd
- Kazakhstan – 1.569 million bpd
- Algeria – 0.971 million bpd
- Oman – 0.811 million bpd
While the size of any additional hike remains unclear, even a moderate adjustment could help offset fears of supply interruptions tied to the Iran conflict.
What Could Happen Next?
Several banks and energy consultancies have outlined diverging scenarios depending on how events unfold.
Barclays sees oil approaching $80 per barrel if strikes avoid key energy infrastructure, but warns prices could surge toward $100 if Iranian fields or export terminals are hit. Rystad Energy projects a temporary spike of $10 to $15 per barrel in the event of a broader conflict without major supply damage. JPMorgan outlines a far more extreme case – $130 oil – should Iran attempt to block the Strait of Hormuz, a chokepoint that handles roughly 20% to 30% of global seaborne crude flows.
At the same time, the International Energy Agency expects a global surplus of 3.8 million bpd in 2026. That projected oversupply could soften price pressures – unless OPEC+ keeps output restrained or conflict-related disruptions tighten flows more sharply than anticipated.
Early Signs of Action
There are indications that contingency planning may already be underway. Saudi Arabia has reportedly lifted production and export volumes to prepare for potential regional bottlenecks. The UAE is also expected to ship increased volumes of its flagship Murban crude in April.
The March 1 meeting now carries outsized importance. A larger production hike would aim to cool prices and reassure consuming nations, while a smaller move would prioritize revenue stability for producers. With tensions elevated and markets sensitive, OPEC+ faces a delicate balancing act between preventing supply shocks and avoiding a renewed glut later this year.
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