OPEC+ Loses Influence on the Market, Production Share Drops to 40%

After six months of war with Iran, OPEC+ has lost its ability to influence the oil market. The war has closed the main export route for Middle Eastern oil and damaged the energy infrastructure in OPEC countries, undermining price regulation mechanisms. The reduction of oil imports by China has become the main factor in balancing the market. In July, OPEC+ accounted for about 40% of global oil production, significantly down from over 48% at the beginning of the U.S. and Israel's military operation against Iran in late February. The four to five percentage points drop is linked to the exit of the United Arab Emirates from OPEC. The core group of seven producers, including Saudi Arabia and Russia, provided only a quarter of global production in July. The conflict has limited the alliance's ability to change supply volumes through the Strait of Hormuz. Since March, OPEC+ has announced six increases in production, but due to physical constraints, these decisions have not affected pricing. Current disruptions are unprecedented for the organization, founded in 1960, and block the capacities of several leading producers simultaneously. OPEC has not commented on the situation, stating its intention to maintain market stability.

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