OPEC Begins Work on 2027 Oil Output Baselines Amid Quota.....

Samuel Mobolaji

The Organization of the Petroleum Exporting Countries (OPEC) has begun developing a new framework for setting oil production baselines for 2027, as internal disagreements among member states continue to shape the group’s long-term strategy.

In a statement released on Wednesday, the 22-member OPEC+ alliance, which includes OPEC and non-OPEC partners such as Russia, said it had tasked the OPEC Secretariat with formulating a mechanism to assess each country’s maximum production capacity. This assessment will serve as the reference point for future quota allocations.

The move comes as several members, including the United Arab Emirates and Iraq, push for higher production quotas, citing expanded capacity, while others, particularly in Africa, have faced declining output. Angola exited the group in 2024 over a dispute concerning its production target.

While Wednesday’s meeting made no immediate changes to existing output policies, discussions are ongoing regarding a possible further increase in supply. Delegates said eight OPEC+ producers currently unwinding prior cuts could raise output in July by 411,000 barrels per day—the same level as in May and June.

The group has maintained three layers of output cuts since 2022, two of which will remain in place until the end of 2026. The current round of gradual supply increases began earlier this year, with talks suggesting the final portion of cuts could be lifted by October.

The 2027 baseline review is expected to feature prominently once all current cuts expire. However, setting new quotas remains contentious due to differing national interests and production capabilities.

Oil prices, which slumped to a four-year low below $60 per barrel in April on concerns of oversupply and global economic weakness, have since recovered to around $65. Analysts say clarity on future production baselines could help stabilise the market, but internal divisions within the group may complicate consensus.