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OPEC+ Maintains Oil Production Amid Global Market Volatility

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OPEC+ Maintains Oil Production Amid Global Market Volatility

BAKU, AZERBAIJAN – On Sunday, the Organization of the Petroleum Exporting Countries and its allies (OPEC+) concluded a meeting by affirming its existing oil output targets. The session, which focused on market stability, did not include discussions regarding political events affecting some member nations.

Market Environment

In 2025, global oil prices experienced a decline exceeding 18%, marking the most significant annual reduction since 2020. This downturn occurred amidst heightened concerns about an oversupply of oil in the market.

Regional and International Developments

This decision by OPEC+ follows several significant geopolitical events:

  • Saudi Arabia and UAE Relations: Tensions between Saudi Arabia and the United Arab Emirates heightened last month. This was observed in the context of a conflict in Yemen, where a UAE-aligned group gained control of territory from the Saudi-backed government. This development marked a notable divergence between the two states.
  • Venezuela: The United States took Venezuelan President Nicolas Maduro into custody on Saturday. Following this, U.S. President Donald Trump announced that the U.S. would assume control of Venezuela until a transition to a new administration was viable. Specifics on the implementation of this plan were not provided.

According to an energy analyst, political uncertainty is a primary driver in oil markets, with OPEC+ observed to be prioritizing stability in its strategy.

OPEC+ Production Strategy Details

The eight OPEC+ member countries involved — Saudi Arabia, Russia, the UAE, Kazakhstan, Kuwait, Iraq, Algeria, and Oman — had previously increased their oil output targets by approximately 2.9 million barrels per day in 2025. This volume equated to nearly 3% of global oil demand at that time.

In November, these nations collectively agreed to pause output increases for January, February, and March. This pause was attributed to anticipated lower demand during the Northern Hemisphere winter. Sunday's online meeting reaffirmed this previously established policy. A delegate from OPEC+ confirmed that the situation in Venezuela was not part of the meeting's agenda.

Historical Context and Current Challenges

Historically, OPEC has managed to navigate various internal divisions, such as during the Iran-Iraq War, by prioritizing market management over political disputes. However, the group is currently facing additional challenges:

  • Russia: Russian oil exports have been impacted by U.S. sanctions related to the conflict in Ukraine.
  • Iran: Iran is experiencing internal unrest and external threats of intervention.

Venezuela's Oil Capacity

Venezuela holds the world's largest proven oil reserves. Despite this, its oil production has significantly decreased over time, a result of factors including internal management challenges and international sanctions. Analysts predict that a substantial recovery in crude output from Venezuela is unlikely for several years, even with potential investments from U.S. oil companies.