OPEC+ Maintains Oil Production Policy Amid Iran War Disruptions

OPEC+, an oil-producing alliance of countries led by Saudi Arabia and Russia, has decided to maintain its current oil production policy for October. This decision comes despite disruptions from the ongoing Iran war that continue to restrict crude exports through the Strait of Hormuz.

The group's ability to influence physical supply is severely limited due to these restrictions. 'OPEC+ currently has very limited power over the physical oil market,' said Jorge Leon of Rystad Energy. 'The group can change production targets on paper, but it cannot guarantee that those barrels will be produced or actually reach the market.'

OPEC+ had previously agreed to a phased reversal of 1.65 million barrels per day in voluntary supply cuts first introduced in 2023. However, due to ongoing disruptions, the group continues to produce well below its targets.

The decision follows the group's September production increase and confirms expectations that emerged in July when it was reported that OPEC+ would likely pause production increases for three months starting in October. The pause will leave around 2 mmbbl/d of cuts in place while the group discusses new production quotas for 2027.

OPEC+ must now review members' production capacity before setting 2027 output baselines, which will determine future quotas. Another layer of production cuts covering most members of the 21-country group remains in place through the end of 2026.