OPEC+ Members to Undergo Annual Oil Capacity Audit

OPEC+ members will undergo a new annual evaluation of their oil production capacity beginning next year, with the results set to guide the bloc’s output quotas for 2027. The decision is designed to ensure that each member’s production target reflects its genuine ability to pump oil, creating a more accurate and credible quota system.

A Breakthrough After Years of Disputes

This development stems from an agreement reached on Sunday, marking meaningful progress on an issue that has challenged the alliance for years. The new system is expected to strengthen confidence among investors and global oil market participants by bringing greater transparency and consistency to future production agreements.

Diverging Capacities Among Member States

Countries within OPEC+ have experienced diverging trends in production capacity. The United Arab Emirates has significantly expanded its output potential and has long pushed for higher quotas. In contrast, several African members have experienced declines, complicating the task of setting fair production targets.

Political and Economic Sensitivities

For certain members, accepting lower quotas based on reduced capacity is both politically and economically sensitive. Angola’s decision to exit OPEC in 2024 underscored this tension, as it left the organisation following disagreements over its production limits.

Saudi Arabia’s Support for the New Mechanism

Saudi Energy Minister Prince Abdulaziz bin Salman described Sunday’s meeting as one of the most rewarding days of his career. He emphasised that the new capacity-assessment framework will help stabilise global markets and ensure that countries investing in capacity expansion are recognised through higher future production allocations.

Timeline for Implementation

The capacity assessments will begin in 2026, and the findings will form the basis of the 2027 production baselines from which quotas are derived. This structured timeline aims to give member states clarity and sufficient preparation time.

External Experts to Conduct the Evaluations

To carry out the assessments, OPEC+ plans to appoint U.S.-based petroleum consultancy DeGolyer and MacNaughton to evaluate the capacities of 19 out of 22 member countries. Additionally, an Indian firm is expected to be selected soon to handle the assessments for Russia and Venezuela. Iran, meanwhile, has opted for its capacity to be determined using its actual production data rather than third-party evaluation.