OPEC: Iraq, Kazakhstan to deepen output cuts under compensation plan

OPEC+ Confirms Iraq, Kazakhstan, and Others to Make Deeper Oil Output Cuts Under New Compensation Plan
Seven OPEC+ members, including Oman, to reduce production further through mid-2026 to offset previous overproduction

MOSCOW – The Organization of the Petroleum Exporting Countries and its allies (OPEC+), which includes Russia and several non-OPEC oil producers, announced on Wednesday that key member states will deepen their oil production cuts as part of a revised compensation plan aimed at balancing the market.

This updated strategy is intended to make up for past overproduction by countries such as Iraq and Kazakhstan, who had previously exceeded their agreed output quotas. OPEC+ has been actively managing oil supply levels since late 2022 in an effort to stabilize global prices.

Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, and Oman are among the seven OPEC+ countries that must cut their output by a total of 369,000 barrels per day (bpd) between now and June 2026 in accordance with the new compensation plan. These decreases, which will be made in monthly increments, are a minor increase above the previous plan, which covered March 2024 to June 2025.

According to statistics assessed by Reuters, the previously agreed range of 189,000 bpd to 435,000 bpd would now be replaced with monthly reduction objectives ranging from 196,000 bpd to 520,000 bpd.

By maintaining a restricted supply overall, this compensatory effort will essentially offset a separate anticipated rise of 411,000 bpd by other OPEC+ members beginning in May, further supporting the world’s oil markets.

In May alone, six of the seven participating countries are expected to reduce output by a collective 378,000 bpd, with Algeria also listed in the OPEC+ table but not required to make any further cuts.

Despite previous agreements, some countries have consistently fallen short of fulfilling their quotas. Iraq — the largest overproducer in the group — now plans to scale back its crude exports significantly to comply with the new targets. A source familiar with the plan noted that Iraq’s oil allocations to clients for May are notably lower, indicating a more serious commitment to honoring the cuts.

Iraq will need to compensate for a cumulative 1.93 million bpd of excess production by mid-2026. Kazakhstan, the second-highest overproducer, is expected to reduce output by 1.3 million bpd within the same time frame.

While the revised plan signals a stronger push by OPEC+ to maintain discipline, the group’s ability to enforce the cuts consistently remains under close watch by the market.