OPEC Oil Output Falls 34% Below Pre-War Levels in May

OPEC's crude oil production averaged 18.82 million barrels per day in May, a 34% decline compared to pre-war levels in February, before the Iran conflict and the blockade of the Strait of Hormuz. This represents a reduction of 9.8 million barrels per day from February, according to independent institutes cited in OPEC's monthly report. The decline is consistent with the year-over-year drop seen in April. Month-over-month, May output fell by 177,000 barrels per day, driven primarily by a 546,000 barrel-per-day drop in Iran's production to 2.3 million barrels per day. The data also includes output from the United Arab Emirates, which left OPEC at the start of May.

Global Impact

Economically, the supply shortfall risks a new oil price spike, stoking global inflation and complicating central bank policy normalization. Geopolitically, the Iran conflict and Strait of Hormuz blockade escalate regional instability, threatening broader Middle East supply chains and potentially drawing in naval powers.