OPEC+ meets this week to decide oil production levels for December, marking its first gathering since the United States imposed sanctions on Russia’s two largest oil companies — a move targeting the alliance’s second-biggest producer after Saudi Arabia.
The coalition, which includes OPEC members and allied producers led by Saudi Arabia and Russia, has managed global oil supplies for nearly a decade by curbing output to ensure what it calls “market stability” — a phrase that effectively means supporting prices or preventing a collapse.
Loss of market share
Since the price crash during the COVID-19 pandemic and the brief market-share war that followed, OPEC+ has maintained varying degrees of output cuts. Not all members have agreed to sacrifice revenue and market share.
Two years ago, eight key producers — including Saudi Arabia, Iraq, the UAE, Kuwait, and Algeria within OPEC, along with Russia, Kazakhstan, and Oman outside it — formed a smaller sub-alliance within OPEC+ to coordinate what became known as “voluntary cuts.”
Yet over the past two years, high oil prices have encouraged strong growth in US shale production, gradually eroding OPEC+’s share of the global market.
By spring 2025, Saudi Arabia appeared increasingly frustrated with the burden of carrying the largest share of these cuts, as both its revenues and market position declined.
In April 2025, the alliance began gradually unwinding its production curbs, announcing cumulative quota increases of 2.7 million barrels per day so far. However, actual output increases have been smaller, as some producers have struggled with capacity constraints or were still compensating for past overproduction.
In early October, OPEC+ maintained its cautious approach, approving a modest 137,000 barrels per day increase for November — a move aimed at preventing price weakness amid softer post-summer demand and expectations of oversupply.
Despite signs of slowdown, the group reiterated that it would continue easing cuts “in light of stable economic forecasts and healthy market fundamentals, as reflected in low inventory levels” — language it has repeated in every statement since April.
The organization continues to emphasize flexibility, reserving the right to pause or reverse any further increases if conditions warrant.
The group will meet on November 2 to finalize December production, and Reuters sources within the alliance indicate that members are leaning toward another small increase of roughly 137,000 barrels per day.
Recovering market share?
Bloomberg Opinion’s Javier Blas argues that Saudi Arabia is unlikely to reverse the recent production increases unless Brent crude falls and stays in the low-$50 range.
If Brent drops to that level, West Texas Intermediate (WTI) would likely fall below $50 per barrel, which would slow US shale output growth — as industry officials say even $60 is insufficient to sustain expansion.
In recent weeks, WTI has hovered in the high-$50 range but climbed above $60 late last week following US sanctions on Russia’s Rosneft and Lukoil, imposed over what Washington described as Moscow’s “lack of seriousness” in ending the war in Ukraine.
Those sanctions are set to take effect on November 21, creating new uncertainty in global supply chains and among major buyers of Russian oil such as India and China.
The unclear impact of the sanctions has added a fresh geopolitical layer to oil pricing, with traders still uncertain how enforcement will unfold and to what extent buyers will comply.
A cautious balance
The recent rebound in prices gives OPEC+ justification to continue unwinding cuts slowly — even symbolically — benefiting mainly Saudi Arabia, which holds the largest spare production capacity.
Analysts expect the alliance to keep adding small monthly increments until the market sees clearer signs of oversupply or until the full impact of US sanctions on Russia becomes evident.
While most analysts and investment banks agree that a supply glut is likely on the horizon, the exact scale remains uncertain — particularly if Russia diverts more crude into the so-called “shadow trade” outside official export channels.
