The expected July increase of around 188,000 barrels per day, which is expected to be pledged by seven key members including Saudi Arabia and Russia, is largely symbolic. The ongoing conflict and the virtual closure of the Strait of Hormuz mean that producers such as Saudi Arabia, Iraq and Kuwait cannot increase their real exports. The group's actual production fell significantly from 42.77 million barrels per day in February to 33.19 million in April, Reuters reports.
The decision to raise production targets, according to some commentators, could be seen as a preparatory step for the reopening Strait of Hormuz, a key transit route for about 20 percent global oil trade.
However, industry experts have warned OPEC+ that even if the shipping lane is reopened soon, it will take many months to return to pre-war operating levels and supply disruptions are likely to last until the end of 2026. The market recorded a deficit of more than 1 billion barrels in 2026 due to the shutdowns.
Oil prices remain volatile: at the beginning of June, Brent was trading at around $93 per barrel and WTI was trading at around $90.50 per barrel. A few days before the meeting, OPEC lowered its forecast for oil demand growth in 2026, pointing to the effects of war and high energy prices, which are causing “demand destruction” in some economies. Analysts noted that without a significant production increase from OPEC+ and a resolution to the conflict, prices are likely to remain high.
Oil prices fell to $90.5 on Friday. per barrel. That's a lot less than even $110-120. quoted in April, but still much higher than $65. paid in February, before the US-Israeli attack on Iran.
The market underestimates the complexity of restoring navigation through the strait
Investors are assessing progress in US-Iran negotiations. However, these are protracted and traffic in the Strait of Hormuz remains limited. US President Donald Trump said on Thursday that he would be open to meeting with Iranian Supreme Leader Mojtaba Khamenei if the countries reach an agreement to end the war.
The AFP agency reported, citing sources, that the Shiite organization Hezbollah, supported by Iran, rejected the ceasefire proposal negotiated by Israeli and Lebanese diplomats in Washington with U.S. mediation and passed this information on to the Lebanese authorities.
Analysts also raised concerns about the decline in global oil stocks, which may result in price increases in the third quarter.
See also: Oil exports through Hormuz did not return to pre-war levels for a long time. This will affect prices
“Any pockets of optimism remain clouded by a tangle of contradictory information. From a technical perspective, as long as WTI crude oil remains above the trend line around $80, the risk remains upside,” wrote Tony Sycamore, IG market analyst, in a report.
On Thursday, Secretary General Haitham Al Ghais said that despite the conflict in the Middle East and the closure of the Strait of Hormuz, OPEC maintains its forecast of an increase in oil demand at 1.2 million barrels per day this year.
Kristian Kerr, director of macro strategy at LPL Financial, said that markets underestimate the complexity of restoring shipping through the Strait of Hormuz to pre-war levels, even if Washington and Tehran sign a memorandum of understanding.
“Any early increase in barrel inventories is likely to come from oil already produced, including oil sitting on stranded or floating vessels and from Iranian cargoes in storage, rather than from a sustained resumption of production or exports. In other words, it is more about removing existing bottlenecks than rebuilding the supply base,” he said.
