OPEC+ likely to agree another oil output hike without UAE, sources say

LONDON - OPEC+ will likely agree a small oil output quota hike on May 3 despite the loss of the lion’s share of its exports due to the US-Israeli war with Iran and the exit of a key member, the United Arab Emirates, three sources with knowledge of the discussions told Reuters.

The oil producer group will likely agree an increase of around 188,000 barrels per day in oil output targets, the sources said. The increase is similar to the hike of 206,000 bpd in March minus the share of the UAE, which leaves the group from May 1.

The decision would signal that OPEC+ is pressing on with a business as usual approach, one of the sources said.

All sources spoke on condition of anonymity. The group has yet to take a final decision ahead of the meeting, another of the sources said.

OPEC did not immediately respond to a request for comment sent after business hours on April 29.

The Iran war which began on Feb 28 and the resulting closure of Hormuz has throttled exports from OPEC+ members Saudi Arabia, Iraq and Kuwait, as well as the UAE. Before the conflict, these producers were the only countries in the group able to raise production.

Crude oil output from all OPEC+ members averaged 35.06 million bpd in March, down 7.70 million bpd from February, OPEC said in a report earlier in April, with Iraq and Saudi Arabia making the biggest cuts due to constrained exports. Outside the Gulf, Russia has also cut output after infrastructure was damaged by Ukrainian drone attacks.

The seven members meeting on May 3 are Saudi Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia, and Oman. With the UAE leaving, OPEC+ includes 21 members including Iran, but in recent years only the seven nations plus the UAE have been involved in monthly production decisions. REUTERS