OPEC+ Prepares to Boost Oil Production, Will Prices Fall?

Jakarta, CNBC Indonesia - The Organization of Petroleum Exporting Countries and its allies, or OPEC+, is reportedly set to agree in principle to raise its oil production target again in June. However, this step is expected not to have a real impact while the United States (US) and Iran conflict continues to disrupt supplies from the Gulf region.

Citing a Reuters report, two sources familiar with the internal discussions stated that seven OPEC+ member countries have agreed to increase production by around 188,000 barrels per day. This marks the third consecutive monthly increase.

“Seven countries have agreed in principle to raise the oil production target by around 188,000 barrels per day in June,” the source said, quoted on Sunday (3/5/2026).

The seven countries involved in this decision are Saudi Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia, and Oman. Meanwhile, the United Arab Emirates (UAE) officially left the group in early May, leaving OPEC+ with 21 member countries.

Despite the additional quota, the actual increase in production is expected to remain limited. This is because the vital Strait of Hormuz route, which previously handled nearly 20% of global oil and liquefied natural gas (LNG) shipments, is still affected by the conflict.

The source emphasised that the current production increase is more symbolic until energy distribution returns to normal. “This increase will remain on paper until the Strait of Hormuz is reopened and supplies from the Gulf flow smoothly again,” it said.

Several energy industry players also estimate that it will take weeks to months for oil shipment flows to fully recover, even after the route is reopened.

Amid this supply disruption, global oil prices have surged sharply. This week, prices briefly broke through US$125 per barrel, or around Rp2.12 million (assuming an exchange rate of Rp17,000 per US dollar), the highest level in the past four years.

This price surge has triggered market concerns over a potential energy crisis, including jet fuel shortages in the next one to two months and pressure on global inflation.

Nevertheless, OPEC+’s decision to proceed with raising the production target demonstrates a “business as usual” approach amid geopolitical uncertainty.

“This decision indicates that OPEC+ is ready to increase supplies after the war ends,” another source said.

For context, OPEC+ crude oil production averaged 35.06 million barrels per day in March. This figure fell by 7.70 million barrels per day compared to February, mainly due to reduced production in Iraq and Saudi Arabia from limited exports.

Outside the Gulf region, Russia also experienced a production decline after its energy infrastructure was impacted by Ukrainian drone attacks.