By Giulia Petroni and Farhan Rafid
OPEC and its allies agreed to raise oil output again in a move widely seen as symbolic as the war in the Middle East has choked off a critical waterway through which a fifth of the world's oil passes.
Seven members of the Organization of the Petroleum Exporting Countries and the broader group called OPEC+ agreed to raise production by about 188,000 barrels a day in July, a fourth consecutive monthly increase, the group said in a statement following a virtual meeting Sunday. The OPEC+ members who agreed to the hike include Saudi Arabia -- the cartel's de-facto leader -- along with Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman.
The production increase is largely viewed by analysts as a statement of intent because the impact on global markets is expected to remain limited until flows resume through the Strait of Hormuz. Oil prices have soared since Iran effectively closed Hormuz after the start of the war with the U.S. and its allies in the region on Feb. 28.
Disruptions in the waterway have pushed major Gulf producers to redirect crude flows away from Hormuz. Saudi Arabia has ramped up use of its East-West pipeline to the Red Sea port of Yanbu, raising flows to around 7 million barrels a day from the prewar rate of roughly 2 million barrels a day. The United Arab Emirates, which left the oil-exporters group at the end of April, has rerouted some of its oil exports via a pipeline to Fujairah, a port city outside the Hormuz strait.
In recent weeks, dozens of ships, some of them the world's largest tankers laden with oil and liquefied natural gas, have traversed the dangerous crossing, The Wall Street Journal reported late last month.
The pipelines and the small number of the crossings can't replace all the crude carried by tanker ships through a free and open waterway, analysts say, but their use is helping prevent an even worse crisis from unfolding.
Tensions remain elevated in the region despite a ceasefire struck two months ago by the U.S. and Iran, with the two sides exchanging fire again over the weekend, the latest in a series of recent skirmishes.
President Trump is pursuing a memorandum of understanding with Iran that would extend the ceasefire and reopen the Strait of Hormuz, but he has been reluctant to meet Tehran's demands for access to billions of dollars in now-frozen cash and less-than-stringent commitments on its nuclear program as the price of a deal. Mediators in the talks say they remain stalled over those issues.
Sunday's meeting is the second after the U.A.E. abruptly exited OPEC, raising questions about the cartel's cohesion and long-term influence over global oil markets as the Iran war redraws energy trade flows and strategic alliances across the region. The U.A.E. was OPEC's third-largest producer and has in recent years wanted to boost its output beyond levels allowed by the cartel's quota system.
The seven OPEC+ members are scheduled to meet again on July 5 to decide production levels for August.
Write to Giulia Petroni at giulia.petroni@wsj.com and Farhan Rafid at farhan.rafid@wsj.com
(END) Dow Jones Newswires
June 07, 2026 11:37 ET (15:37 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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