The OPEC+ alliance, which produces roughly half the world's oil, decided to maintain its current production levels during a brief online meeting on Sunday. The decision comes as the global oil market grapples with a significant price collapse and escalating political instability among several of the group's key member states.
Market Pressure and Political Fractures
Sunday's meeting of eight core OPEC+ nations—Saudi Arabia, Russia, the UAE, Kazakhstan, Kuwait, Iraq, Algeria, and Oman—was convened against a grim economic backdrop. Oil prices have fallen more than 18% in 2025, marking the steepest annual decline since 2020, largely due to growing fears of an oversupply.
Compounding the market anxiety are deep political rifts. Tensions between Saudi Arabia and the United Arab Emirates erupted last month over the conflict in Yemen, where a UAE-aligned group seized territory from the Saudi-backed government. This event triggered what analysts call the most serious split between the long-time allies in decades.
The geopolitical landscape was further shaken on Saturday, when the United States captured Venezuelan President Nicolas Maduro. U.S. President Donald Trump stated Washington would assume control of the country until a political transition is possible, though details remain unclear.
Stability Over Action
In this volatile environment, the producer group chose inaction. The meeting, which one delegate said did not discuss Venezuela, simply affirmed an existing policy. The eight members had agreed in November to pause output increases for January, February, and March due to typically lower winter demand in the Northern Hemisphere.
"Right now, oil markets are being driven less by supply-demand fundamentals and more by political uncertainty," said Jorge Leon, head of geopolitical analysis at Rystad Energy and a former OPEC official. "And OPEC+ is clearly prioritizing stability over action."
This group had previously raised collective output targets by approximately 2.9 million barrels per day in 2025, an amount equal to nearly 3% of global demand, in a bid to regain market share.
Underlying Crises Challenge Cohesion
While OPEC has a history of sidelining political disputes—such as during the Iran-Iraq War—to focus on market management, the current array of crises is formidable. Beyond the Saudi-UAE rift and the Venezuela shock, the alliance faces other significant challenges:
- Russian oil exports are under pressure from U.S. sanctions related to the war in Ukraine.
- Iran is contending with domestic protests and threats of U.S. intervention.
- Venezuela, despite holding the world's largest proven oil reserves, has seen its production crippled by years of mismanagement and sanctions.
Analysts note that even with potential massive investment from U.S. oil companies as hinted by Trump, Venezuela's crude output is unlikely to see a meaningful recovery for years. The group's next scheduled meeting is set for February 1, where these mounting pressures will once again be on the agenda.
