Oil Prices Today: Oil prices remained elevated on Monday, with Brent crude hovering near the $97-a-barrel mark, as the ongoing US-Iran conflict continued to disrupt oil flows through the Strait of Hormuz.
Last checked, Brent crude futures were up 0.75% at $96.57 a barrel at last check, after gaining nearly 8% last week.
The move comes after OPEC+ kept its oil output policy unchanged for October at a meeting on Sunday. The producer group said it needs to agree on new production quotas before determining its next steps on output.
The decision comes as the prolonged Iran conflict limits OPEC+'s ability to influence physical oil supplies and prices. The war has disrupted exports through the strategically important Strait of Hormuz, through which a major share of global oil shipments typically passes.
Oil Prices: Brent, WTI Surge Nearly 10% In A Week
Oil prices posted a sharp weekly gain as the US and Iran resumed military exchanges in the seventh month of the conflict.
Brent crude futures rose $7.08, or nearly 8%, last week to close at $96.28 a barrel on Friday. West Texas Intermediate (WTI) crude gained almost 10% over the week, settling at $91.48 a barrel.
The rally has also pushed US diesel prices to a record high, adding to concerns over the potential impact of the conflict on fuel costs and inflation.
Why Did OPEC+ Keep Oil Output Unchanged?
The seven core OPEC+ members, which include Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman, met on Sunday and decided to maintain the group's existing oil output policy for October.
In August, OPEC+ had agreed to increase production for September, completing a phased rollback of a 1.65 million-barrel-per-day supply cut introduced in 2023.
However, despite the planned production increases, actual output from the wider OPEC+ group remains below its targets, with the ongoing conflict creating additional supply disruptions.
Iran War Limits OPEC+'s Influence Over Oil Market
The Iran conflict has conisderably complicated OPEC+'s ability to manage global oil supply.
“OPEC+ currently has very limited power over the physical oil market,” said Jorge Leon of Rystad Energy. The group can alter production targets, he said, but cannot guarantee that additional barrels will actually be produced or reach the market.
With supply disruptions dominating the oil market, the focus is increasingly shifting from monthly production adjustments to the group's longer-term production strategy.
OPEC+ Faces Bigger 2027 Production Decision
OPEC+ still has another layer of production cuts covering most members of the 21-country group through the end of 2026.
Before deciding how to unwind those cuts and bring additional crude back to the market, the group needs to assess individual members' production capacity and establish new 2027 production baselines.
That process is expected to become a major issue later this year. Sources had previously indicated that OPEC+ could pause further production increases in the fourth quarter as it prepares for the 2027 quota debate.
The group's Sunday statement did not provide details on its policy beyond October.
When Is The Next OPEC+ Meeting?
The seven OPEC+ members that met on Sunday are scheduled to meet again on October 4.
For now, however, the oil market remains heavily focused on the US-Iran conflict, the security of crude shipments through the Strait of Hormuz and the possibility of further supply disruptions.
With Brent already close to $100 a barrel after an almost 8% weekly surge, any further escalation in the conflict could keep upward pressure on crude prices.
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