OPEC+ to maintain steady oil output

Organisation of Petroleum Exporting Countries (OPEC+) has indicated it would likely maintain steady oil output despite political tensions between key members Saudi Arabia and the UAE and the United States capture of the President Venezuela.

The assurance was given yesterday after a meeting by eight members of OPEC+, which pumps about half the world’s oil. This comes after oil prices fell more than 18 per cent in 2025-  their steepest yearly drop since 2020 -amid growing oversupply concerns.

The eight countries- Saudi Arabia, Russia, the UAE, Kazakhstan, Kuwait, Iraq, Algeria and Oman – raised oil output targets by around 2.9 million barrels per day from April to December 2025, equal to almost three per cent of world oil demand.

They agreed in November to pause output hikes for January, February and March. The meeting on yesterday is unlikely to make any changes to that policy, according to Reuters citing three OPEC+ sources.

Tensions between Saudi Arabia and the UAE flared last month over a decade-long conflict in Yemen, when a UAE-aligned group seized territory from the Saudi-backed government. The crisis triggered the biggest split in decades between the former close allies, as years of divergence on critical issues came to a head.

OPEC has in the past managed to overcome serious internal rifts, such as over the Iran–Iraq War, by prioritising market management over political disputes. Yet the group is facing numerous crises, with Russian oil exports pressured due to U.S. sanctions over its war in Ukraine, and Iran facing protests and U.S. threats of intervention.

On Saturday, the United States captured Venezuelan President Nicolas Maduro and U.S. President Donald Trump said Washington would take control of the country until a transition to a new administration becomes possible, without saying how this would be achieved.

Venezuela has the world’s largest oil reserves, bigger even than those of OPEC’s leader Saudi Arabia, but its oil production has plummeted due to years of mismanagement and sanctions.

Analysts said it is unlikely to see any meaningful boost to crude output for years, even if U.S. oil majors do invest the billions of dollars in the country that Trump promised.

But fears are still rife of oil price facing huge volatility in the coming days following the arrest of the Venezuelan President Nicolás Maduro and his wife, Cilia Flores, by the United States of America. The arrest, market indices pointed at, already led to massive market volatility in the energy sector as traders weigh the risk of civil war against a potential oil recovery.

The fears are right. Venezuela has the world’s largest proven oil reserves. Therefore, for the energy markets, the immediate implication of the US action bothers on the flow of 800,000 to 900,000 barrels of oil per day. Venezuela sits on roughly 300 billion barrels of oil, though most of it are trapped under a crumbling infrastructure that needs billions in Western capital to breathe again.

Experts in the oil industry fear that the markets can expect a massive spike in volatility as traders price in the risk of a Venezuelan civil war versus the potential for a “Chevron-led” recovery of the Orinoco Belt.

Data from the International Energy Agency (IEA) has long highlighted Venezuela as the “wildcard” of global supply. Even before the raid on the country by US, the IEA forecasts for 2026 had been trimmed due to the U.S. blockade and sanctions hitting Russian and Venezuelan exports. If a transitional government friendly to Washington takes over, we could see the fastest return of “lost” barrels in history, that is if the power grid in Caracas does not collapse entirely first.

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As at yesterday, oil performance shows West Texas Intermediate (WTI) hovering around $57-$57.50, slightly up due to supply worries but facing pressure from anticipated oversupply, with technicals leaning bearish and a general trend of price declines through late 2025.

Key drivers include OPEC+ production decisions, geopolitical tensions, and seasonal demand slowdowns, leading to mixed signals with some ETFs showing small gains while overall outlook remains cautious for continued weakness into 2026, according to Trading Economics and OilPrice.com.