Some of the world’s largest oil producers are mulling the possibility of raising oil supply by as much as 500,000 barrels per day (bpd) in a bid to compensate for Iran’s falling output, it has been reported this morning.

Countries within the Organisation of the Petroleum Exporting Countries (Opec) as well as other producers are weighing up the possibility of bolstering oil supply, a source told Reuters.

Benchmark Brent oil prices dropped by more than $1 on the news, slipping to below $79 a barrel after reaching highs of $80 earlier this month.

Such discussions come in the wake of hardening US sanctions on Iran, Opec’s third largest producer, which have been aimed at clamping down on any party involved in trading crude with Tehran.

President Trump has also stepped up calls for Opec to lower prices.

In a tweet earlier this week he said: “We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices! We will remember. The Opec monopoly must get prices down now!”

Read more: Trump slams Opec, urging oil cartel to 'get prices down now'

White House sanctions are likely to have a dramatic impact on the world’s oil market, with Iran having exported roughly 2.5m bpd of crude and condensate this year, equivalent to around 2.5 per cent of global consumption.

Trump’s decision to scrap the US-Iran nuclear deal is also likely to prompt many businesses to step back from investment in the country.

Earlier this summer companies such as British Airways and Air France announced they will stop flying to Iran, as both airlines warned that the route was no longer “commercially viable”.