OPEC+ Unveils New Capacity-Based System to Anchor Future Oil Output Levels
Saudi Arabia says the mechanism will stabilise global markets and reward producers investing in long-term capacity
OPEC+ has approved a new mechanism to determine each member’s maximum sustainable production capacity, a shift Saudi Arabia says will strengthen market stability and create a fairer basis for future output quotas.
The framework, endorsed at the group’s latest meetings, will guide the baselines used to set official production limits from 2027 onward.
Capacity assessments are scheduled to run between January and September 2026, using a detailed technical process that OPEC+ ministers say marks a major step toward greater transparency.
Speaking at a Saudi–Russian business forum in Riyadh, Saudi Energy Minister Prince Abdulaziz bin Salman described the agreement as one of the most significant achievements of his career.
He emphasised that the mechanism rewards countries willing to invest in expanding their production capabilities and noted the strong backing of Russia in reaching the agreement.
He said the group now has “the most detailed and transparent approach” for managing supply and ensuring discipline across the alliance.
The meetings also resulted in OPEC+ keeping oil-output levels unchanged for the first quarter of 2026, a move intended to preserve stability amid shifting global demand.
The decision reflects a shared preference for steadier production after prolonged internal debate among members with differing capacity trajectories.
Nations such as the United Arab Emirates, which have increased their capacity, have pressed for higher quotas, while others, including several African producers, have seen capacity declines and resist reductions.
The departure of Angola from the group in 2024 underscored the tension surrounding quota equity.
The newly adopted assessment structure is expected to ease such disputes by anchoring future quotas in verifiable capacity data.
For sanctioned countries, capacity may be derived from output averages rather than independent physical inspections.
OPEC+ officials argue that the mechanism will support a more predictable supply outlook and position the alliance as a disciplined market manager at a time of heightened global energy uncertainty.
By linking future production rights to demonstrated investment, the policy also reinforces long-term planning across the group, encouraging members to expand upstream development and maintain their infrastructure.
Ministers say this foundation will help OPEC+ remain competitive among global producers and strengthen its influence over market conditions leading into 2027.
The framework, endorsed at the group’s latest meetings, will guide the baselines used to set official production limits from 2027 onward.
Capacity assessments are scheduled to run between January and September 2026, using a detailed technical process that OPEC+ ministers say marks a major step toward greater transparency.
Speaking at a Saudi–Russian business forum in Riyadh, Saudi Energy Minister Prince Abdulaziz bin Salman described the agreement as one of the most significant achievements of his career.
He emphasised that the mechanism rewards countries willing to invest in expanding their production capabilities and noted the strong backing of Russia in reaching the agreement.
He said the group now has “the most detailed and transparent approach” for managing supply and ensuring discipline across the alliance.
The meetings also resulted in OPEC+ keeping oil-output levels unchanged for the first quarter of 2026, a move intended to preserve stability amid shifting global demand.
The decision reflects a shared preference for steadier production after prolonged internal debate among members with differing capacity trajectories.
Nations such as the United Arab Emirates, which have increased their capacity, have pressed for higher quotas, while others, including several African producers, have seen capacity declines and resist reductions.
The departure of Angola from the group in 2024 underscored the tension surrounding quota equity.
The newly adopted assessment structure is expected to ease such disputes by anchoring future quotas in verifiable capacity data.
For sanctioned countries, capacity may be derived from output averages rather than independent physical inspections.
OPEC+ officials argue that the mechanism will support a more predictable supply outlook and position the alliance as a disciplined market manager at a time of heightened global energy uncertainty.
By linking future production rights to demonstrated investment, the policy also reinforces long-term planning across the group, encouraging members to expand upstream development and maintain their infrastructure.
Ministers say this foundation will help OPEC+ remain competitive among global producers and strengthen its influence over market conditions leading into 2027.
