OPEC Oil Output Rises in May but Falls Short of Target Amid Compensation Cuts
OPEC’s crude oil production increased by 180,000 barrels per day (bpd) in May 2025, reaching 27 million bpd. However, this rise fell significantly short of the planned 411,000 bpd hike for the month, as several member countries continued to implement compensation cuts for previous overproduction. The limited increase highlights the ongoing challenges in aligning production levels across the OPEC+ alliance.
Five key OPEC members, Saudi Arabia, Iraq, the United Arab Emirates, Kuwait, and Algeria, had pledged to collectively boost output by 310,000 bpd as part of their gradual reversal of earlier cuts. Yet, the latest Monthly Oil Market Report (MOMR) from OPEC shows their actual increase was well below expectations.
Saudi Arabia, the group’s top producer and de facto leader, raised its output by 177,000 bpd in May, bringing its total to 9.183 million bpd, just shy of its 9.2 million bpd target. In contrast, Iraq reduced its production by 50,000 bpd to 3.93 million bpd, well below its May target of 4.049 million bpd, as it continues to compensate for previous overproduction.
Total OPEC+ output, which includes non-OPEC producers like Russia and Kazakhstan, averaged 41.23 million bpd in May, representing a modest 180,000 bpd increase from April. The eight OPEC+ members involved in coordinated cuts increased their combined output by only 154,000 bpd, far less than the scheduled 411,000 bpd, largely due to ongoing compensation requirements.
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Kazakhstan remained a notable outlier, producing 1.803 million bpd in May. Although this was a slight decrease from April, it still exceeded the country’s May quota by over 300,000 bpd. Kazakhstan, along with Iraq and Russia, has consistently been among the most noncompliant members in terms of adhering to OPEC+ output targets.
The phased production hikes planned for the summer months were intended to allow member states to meet their compensation obligations while easing into higher output levels. However, the shortfall in May’s actual increase may help soothe market fears of a potential oil glut. Still, geopolitical tensions in the Middle East, particularly the escalating conflict between Israel and Iran, have shifted market focus toward possible supply disruptions rather than overproduction concerns.
