OPEC-12 Output Hits 26-Year Low in May as Hormuz Disruption Erases 1.06 Million Barrels Per Day

OPEC crude output fell to 16.13 million barrels per day in May 2026, the lowest monthly total since at least 2000, according to a Reuters survey of producers. The decline of 1.06 million barrels per day from April put OPEC-12 below the group's 2020 pandemic-era output floors. The May figures exclude the United Arab Emirates, which formally left OPEC on May 1, 2026.

Two Events Drove the Production Collapse

The U.S. naval blockade of Iran, which began April 13, cut Iranian crude and condensate exports to their lowest level in at least six years. Iran then closed the Strait of Hormuz, disrupting shipments from neighboring Gulf producers. The U.S. Energy Information Administration's June Short-Term Energy Outlook estimated the closure affected approximately 11.3 million barrels per day of crude production capacity as of May 2026.

Kuwait routes all its crude exports through the Strait and recorded near-zero outflows for May. Saudi Arabia's output dropped toward 7 million barrels per day following infrastructure attacks. The kingdom used the East-West Pipeline to its Yanbu Red Sea terminal as a partial bypass, but total output remained well below pre-disruption levels.

Eight OPEC+ Members Voted to Raise Output and Failed to Deliver

In April, eight OPEC+ member countries voted to increase May production. None succeeded. Geopolitical disruption overrode their intentions entirely, converting a planned production increase into the group's sharpest single-month output decline in years. This dynamic illustrates why quota decisions have limited effect when the Strait of Hormuz controls the only practical export route for most Gulf members.

Oil Authority Calculation: $92.5 Million Per Day in Foregone Export Revenue

Brent crude settled at $87.27 per barrel on the ICE exchange on Friday, June 12, 2026, down 3.44% on the session, after President Trump stated a peace agreement with Iran could materialize as early as this weekend. At that settlement price, OPEC-12's 1.06 million barrels-per-day month-on-month production drop translates to approximately $92.5 million in foregone daily export value compared to April output. That figure represents production that physically did not move, not a royalty adjustment or quota compliance effect.

Non-Gulf Producers Partially Offset the Shortfall

Venezuela's crude exports reached 1.23 million barrels per day in April 2026, the highest volume since 2018, following a further easing of U.S. sanctions. Libya hit 1.43 million barrels per day, a 10-year high, after the National Oil Corporation completed pipeline and terminal repairs. Iraq and Nigeria also added volume. Their combined gains covered only a fraction of the Gulf shortfall driven by the Hormuz closure.

UAE Exits OPEC to Pursue 5 Million Barrels Per Day Without Quota Constraints

The May output figures mark the first full month since OPEC lost its most expansion-focused Gulf producer. The United Arab Emirates formally exited the organization on May 1, 2026, freeing Abu Dhabi National Oil Company (ADNOC) from the quota framework. ADNOC is targeting 5 million barrels per day by 2027, up from its current range of 3.2 to 3.6 million barrels per day. The company leveraged its Fujairah terminal on the Gulf of Oman to bypass Hormuz, making it the only Gulf producer to grow output during the disruption period.

Bank Forecasters See 2027 Brent at $79 to $80, With a $60-to-$140 Scenario Band

Goldman Sachs cut its 2027 Brent price forecast to $80 per barrel on June 11, citing stronger non-OPEC supply from the United States, Guyana, Brazil, and Venezuela alongside accelerating Chinese demand erosion. Chinese gasoline consumption fell an estimated 20% year-over-year in April 2026, per Goldman's research note. Goldman maintained its Q4 2026 Brent forecast at $90 per barrel but published scenarios spanning $60 to $140 for 2027, driven almost entirely by Hormuz reopening speed.

The EIA's June Short-Term Energy Outlook projects $79 per barrel for 2027 Brent and $95 per barrel for the 2026 annual average. Morgan Stanley's 2027 base case also sits at $80 per barrel, consistent with a supply-normalization timeline that puts Hormuz near full throughput by Q4 2026. Goldman, the EIA, and Morgan Stanley collectively land within a $1 per barrel range for 2027, reflecting near-identical assumptions about Hormuz timeline rather than independent analytical divergence. Trump's Friday statement drove Brent to an eight-week low of $87.27 per barrel, erasing a large portion of the geopolitical premium accumulated since the April blockade began.