Saudi Arabia has started to increase its oil output as part of a contingency plan in the event the United States attacks Iran and oil flows are disrupted, Reuters reported on Wednesday, as OPEC’s biggest oil producer positions itself as a “reliable supplier” looking to take up its traditional role as a key swing producer ready to stabilize the markets if a conflict occurs.
U.S. President Donald Trump recently revealed that he is considering a “limited military strike” on Iran in a bid to pressure its leaders into a new nuclear agreement. Saudi crude shipments jumped to 7.3 million barrels per day (bpd) in the first 24 days of February 2026, the highest level since April 2023.
The Kingdom is prepared to implement a short-term output hike specifically to offset potential supply losses from Iran or disruptions in the Strait of Hormuz, a critical chokepoint.
Saudi Arabia can utilize its East-West Pipeline to the Red Sea to bypass potential Gulf blockades, though its spare capacity is currently limited to ~2.4 million bpd. Iran, which produces around 3.2 million barrels per day (approximately 3% of global oil), has warned that any U.S. or allied military strikes against its territory will trigger immediate and decisive retaliation. The ongoing tensions have raised significant concerns that Iran could attempt to disrupt shipping through the Strait of Hormuz, a critical bottleneck which handles 20-30% of global seaborne oil.
The threat of disruption has increased the geopolitical risk premium on oil, with analysts warning that a conflict could lead to sharp price spikes similar to those that occurred four years ago when Russia invaded Ukraine.
Saudi Arabia’s output hike comes at a time when OPEC+ is considering a resumption of its unwinding program. OPEC+ is likely to consider increasing oil output by 137,000 barrels per day for April 2026 when it meets on March 1, ending a three-month pause in hikes. The group paused its program for the first quarter of 2026 after steady increases of 137,000 bpd in Oct/Nov/Dec 2025 due to fears of oversupply.
By Alex Kimani for Oilprice.com
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