Opec, Opec+ and the oil market: Between coordination and production sovereignty
Published: 03:05 PM,May 05,2026 | EDITED : 07:05 PM,May 05,2026
In energy markets, strength is not measured solely by the size of reserves, but by the ability of producers to coordinate their collective behaviour in a market defined by cycles and volatility. The foundation upon which Opec was established and later expanded into Opec+, as a mechanism to manage supply and maintain a degree of price stability.
Current data indicate that Opec accounts for around 35 –36% of global oil production, rising to approximately 46 – 47% when Opec+ is included, out of a total global supply of about 104–105 million barrels per day. This gives the group meaningful influence over market direction, even if it no longer holds absolute control as it once did.
Membership in this framework is not merely institutional affiliation; it represents participation in a highly calibrated system of market management. When countries agree on production ceilings, they effectively reduce excess supply, support prices, and limit sharp volatility that could disrupt long-term investment decisions.
Historically, the coordinated cuts of Opec+ in 2020, which exceeded 9 million barrels per day during the peak of the Covid-19 crisis, stand as one of the largest interventions in market history and played a critical role in restoring balance after the collapse in prices.
Even smaller adjustments, in the range of one to two million barrels per day, have often been sufficient to shift market sentiment and push prices upward, highlighting the sensitivity of oil markets to coordinated supply changes.
However, this influence comes with a fundamental trade-off. Countries with higher production capacity are required to hold back part of their potential output, which represents a direct economic cost. This reveals the core paradox of quota systems: the greater a country’s production capacity, the higher the opportunity cost of compliance. In simple terms, membership enhances influence over price, but constrains production volume. Governments must therefore carefully balance price gains against foregone output.
By contrast, operating outside such a framework does not diminish production capability, but it does reduce collective influence. A country shifts from being part of a coordinated bloc to acting as an individual player in a competitive market.
In this setting, influence depends on scale, cost efficiency, and operational flexibility rather than collective decisions.
For example, an increase of one million barrels per day represents roughly 1% of global supply—sufficient to exert noticeable downward pressure on prices in a market highly sensitive to marginal changes.
The oil market itself does not permanently favor either model. During relatively stable periods, coordination helps maintain a workable balance between supply and demand, with prices moving within predictable ranges, as seen between 2017 and 2019 when Brent crude fluctuated between $60 and $80 per barrel.
In contrast, during periods of structural change, tensions emerge between the objective of supporting prices and the drive to expand market share. At such times, competition intensifies, and volatility increases rather than stabilises.
These dynamics are not limited to oil. They could be observed, in a different form, in global liquefied natural gas markets. The Gas Exporting Countries Forum does not function as a traditional cartel, largely because gas markets are shaped by long-term contracts that can extend over 15 to 20 years, as well as infrastructure constraints that limit supply flexibility. Liquefied natural gas accounts for around 40% of global gas trade, much of it governed by long-term agreements linked to oil prices or regional benchmarks.
As a result, market influence in gas is exercised through contract structures and supply flows, rather than direct production quotas. This model offers insight into how energy markets more broadly may evolve over time.
Looking ahead, energy markets appear to be moving toward a hybrid model that combines coordination with competition. Opec and Opec+ remain central to market stability, but their role is no longer absolute. It now coexists with other forces, including rising output from non-member producers, particularly the United States, where production exceeds 12–13 million barrels per day, and evolving demand patterns linked to the global energy transition
At the same time, logistical factors have become increasingly important. Around 20% of global oil trade passes through the Strait of Hormuz, making any disruption there a critical variable that can be at these times; outweigh production decisions in determining prices.
In this environment, the definition of strength is changing. It is no longer determined solely by production volume, but by operational efficiency, cost competitiveness, and the ability to access markets reliably.
Bilateral agreements are also gaining prominence, as major economies such as China and India seek to secure stable supplies through long-term contracts rather than relying entirely on spot markets.
Ultimately, Opec and Opec+ should not be viewed as static institutions, but as evolving frameworks adapting to a shifting global landscape. Membership offers the advantage of coordinated influence over prices, but imposes constraints on production. Operating independently provides greater production freedom, but reduces collective leverage.
Between these two approaches lies the future of the oil market, where the ability to balance production sovereignty with price stability, and coordination with competition, will define the strategic position of producers in an increasingly complex energy system.