Hormuz Disruption Redraws the OPEC Supply Map

The latest production data from Bloomberg’s monthly survey and Saxo Bank highlights how unevenly the Strait of Hormuz disruption is hitting Gulf producers.

While Iran remains at the center of the conflict, its oil output has fallen by only around 11% since the war began, the smallest decline among major regional producers. By contrast, several Gulf exporters have suffered far steeper losses as restricted shipping routes continue to disrupt export flows and limit access to global buyers.

Pipeline Access Creates a Clear Divide

Saudi Arabia’s production has declined by roughly 29%, while the UAE has seen output fall around 40%. Both countries appear to be partially shielded by pipeline infrastructure that allows some exports to bypass the Strait of Hormuz. Flexibility has become essential as transport delays, rather than production capacity, are now the primary constraint in the market.

Iraq and Kuwait Face the Heaviest Pressure

The sharpest losses are visible in Iraq and Kuwait. Iraq’s production has dropped by roughly 63%, while Kuwait has suffered the deepest hit, with output down around 69%. The declines underline a growing reality in the oil market: producers can still pump crude, but without reliable export routes, supply cannot move efficiently. As storage fills and tanker access weakens, output cuts become unavoidable.

OPEC Output Falls to Multi-Decade Lows

The broader OPEC picture has weakened considerably. Bloomberg’s survey showed OPEC production falling to its lowest level since 1990 as the Hormuz disruption continues to choke Gulf exports. OPEC+ production increases announced in recent weeks have remained largely symbolic, as physical transport constraints continue to outweigh official quota changes.

Non-Gulf Barrels Gain Strategic Value

Outside the Gulf, the picture looks very different. Venezuela’s production has climbed to a seven-year high, while Libya remains near a 13-year high. As geopolitical transport risks rise, supply that avoids the Strait of Hormuz is becoming increasingly valuable. In the current environment, markets are pricing not only how much oil producers can extract, but also how much they can realistically deliver.

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