OPEC and OPEC+ (OPEC)

OPEC was founded in 1960 by five countries — Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela — and has grown to include members across the Middle East, Africa, and South America. The group's central tool is the production quota: an agreed ceiling on how many barrels per day each member is allowed to produce. When members collectively cut quotas, less oil reaches the market, which tends to put upward pressure on prices. When they raise quotas, supply increases. OPEC decisions are among the most closely watched events on the economic calendar.

OPEC+ was formed in 2016 to bring non-OPEC producers, most importantly Russia, into coordinated supply management. The "plus" group significantly increases the share of global oil production under a single agreement, amplifying the potential market impact of any decision. Meetings typically result in announcements measured in millions of barrels per day — for example, "a cut of 1 million barrels per day" — and markets often move sharply on the headlines. The what moves commodity prices guide explains the supply-side mechanics behind these reactions.

A key confusion is assuming OPEC fully controls oil prices. Member compliance with quotas is imperfect — countries sometimes produce above their agreed limits — and non-OPEC producers like the United States are not bound by any agreement at all. US shale production in particular has grown enough to offset some OPEC+ cuts in recent cycles. Economists read OPEC+ announcements as one major input into the Brent price outlook, alongside demand data, inventory levels, and geopolitical developments tracked on the commodities page.