OPEC+ Adds 188,000 bpd August Quota as Hormuz Traffic Rebounds

Oil markets absorbed another incremental supply signal Sunday when OPEC+ confirmed an August quota increase of 188,000 barrels per day for its seven core members. The move extends the phased return of 1.65 million barrels per day cut in 2023 and arrives while actual tanker loadings through the Strait of Hormuz are rising after months of disruption.

The decision keeps the group on track to complete the rollback by September if the same monthly step is repeated at the August 2 meeting. Seven producers—Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman—have already raised formal targets by nearly 800,000 barrels per day since April. Realized output, however, remains far lower: OPEC data show the group produced 33.13 million barrels per day in May, down from 42.77 million in February.

Recovery began in June after U.S. facilitation helped the UAE and others move additional cargoes. Prices have nevertheless settled near pre-disruption levels, with Brent crude trading around $72 per barrel on Friday after peaking above $120. Lower Chinese imports, rising non-Middle East supply, and a coordinated International Energy Agency stock release have offset the lingering shortfall.

The United Arab Emirates departed the alliance in late April, removing itself from quota discipline to align output with its own capacity. Iraq has separately pressed for larger allowances. With the UAE exit factored in, the remaining 379,000 barrels per day of the original cut will be returned once the September increase occurs, according to Reuters calculations.

A memorandum of understanding between Washington and Tehran has reduced trader concerns about renewed closures. UBS analyst Giovanni Staunovo noted that attention now centers on actual tanker crossings and the pace of Chinese demand recovery.