OPEC+ sticks to its original plan and will suspend production increases in the first quarter of 2026.

OPEC and its allies (OPEC+) have confirmed that they will maintain a pause on production increases in the first quarter of 2026. This decision reflects the alliance’s cautious stance amid increasingly clear signals of a global crude oil market surplus.

Major member countries led by Saudi Arabia confirmed this three-month supply pause plan after a series of video conferences held on Sunday. The plan was first announced at the beginning of this month. The statement reiterated that the decision reflects expectations of seasonal market weakness.

Meanwhile, the alliance approved a mechanism to assess individual member countries’ production capacities. This sensitive process will help determine production quotas for 2027. They selected Dallas-based DeGolyer and MacNaughton Corp to carry out most of the assessments.

Although the pause in production increases shows a degree of caution from the alliance, the global market will still face a significant surplus in early 2026, which may further pressure oil prices. London Brent crude futures have already dropped 15% this year and are currently trading near $63 per barrel.

Market Imbalance Pressures Oil Prices

Jorge Leon, analyst at consulting firm Rystad Energy AS, said:

OPEC+ has chosen to stay the course and maintain its current strategy. The group’s message is clear: Amid rapidly deteriorating market prospects, stability comes before ambition.

Surging supply of crude oil from the U.S., combined with increased OPEC+ production, has outpaced demand growth. The International Energy Agency predicts a record surplus in 2026, and both Goldman Sachs and JPMorgan expect lower futures prices.

A three-month freeze on output gives OPEC+ time to assess intensifying geopolitical risks facing member nations’ supply, as well as efforts to end the Russia–Ukraine conflict. President Trump increased pressure on Venezuela Saturday, warning airlines to consider the country’s airspace and surrounding areas closed.

Production Strategy Faces Fiscal Pressure

Eight core OPEC+ member countries surprised markets in April by announcing an accelerated restoration of output previously paused since 2023, shocking oil traders. Officials described the move as Riyadh’s attempt to recapture market share from competitors like U.S. shale drillers and punish those OPEC+ members violating quotas.

Although Saudi Arabia has successfully regained some market share, the resulting decline in oil prices has challenged the country’s finances, widened its budget deficit, and forced some flagship economic projects to scale back. This also puts pressure on producers outside of OPEC+, such as U.S. shale drillers.

The drop in crude prices comes amid repeated calls from Trump to lower fuel costs in response to voters’ concerns about living expenses. Early November, Trump warmly welcomed Saudi Crown Prince Mohammed bin Salman at the White House, and his administration approved the sale of F-35 fighter jets and AI chips to Saudi Arabia.

Production Quota Adjustment Mechanism Activated

OPEC+ has restored about 70% of the two-tiered production cuts suspended in 2023—at least on paper—but there is still some 1.1 million barrels per day yet to be restored. The group has retained a broader layer of cuts covering the 22-nation group, totaling about 2 million barrels per day, until the end of 2026.

However, the group’s actual monthly increases are smaller than announced because some countries need to compensate for prior excess production, and others struggle to meet the declared targets.

These difficulties are at the heart of the group’s first long-term review of member capacity announced in May. Some countries are seeking recognition of new capacity, while others cannot reach their allowed output. Clarifying their true capacities will help make quotas more realistic and future production cuts more credible.

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