Saudi Arabia informed OPEC that its crude oil production significantly declined in April, reaching its lowest level since 1990. Output dropped by an additional 651,000 barrels a day, bringing the total to 6.316 million barrels a day. This decline represents a 42% loss since February and is directly attributed to the ongoing war with Iran, which has severely disrupted oil exports from the Persian Gulf.
The conflict with Iran has effectively closed a significant portion of the Strait of Hormuz, a crucial chokepoint for approximately one-fifth of global seaborne oil trade. This has led to massive production shutdowns in Saudi Arabia, Iraq, Kuwait, and the UAE, as bypass pipelines have been insufficient to offset the losses. This supply shock has caused global oil inventories to decrease at a record pace, with a draw of 117 million barrels in April, pushing Brent crude prices well above $100 per barrel, averaging around $117 per barrel in April.
In a related development, the United Arab Emirates exited OPEC (and OPEC+) on May 1, 2026, after nearly 60 years of membership. The UAE, previously the third-largest producer in OPEC, accounted for about 3-3.5 million barrels a day of the group's output. Its departure removes significant spare capacity and weakens the cartel's cohesion, placing a greater burden on Saudi Arabia to manage quotas while its own production is severely hampered by geopolitical events.
