Opec+ has recently approved a significant overhaul to its quota system in years — a move that could reshape alliances inside the group, trigger a new wave of upstream spending, and reset who gets to pump what from 2027 onward. The decision centers on a new baseline calculation mechanism and a multi-stage audit that aims to tie future quotas to what each country can actually produce.

This is Opec+ trying to fix a credibility problem years in the making, including widening gaps between official quotas and actual production, persistent overpumping by some members, chronic underdelivery by others, and tensions around how capacity is measured.

What’s new? The cartel agreed to use a new methodology to set members’ baselines, set to become the foundation for future quotas. Between January and September, 19 out of the 22 Opec+ members will undergo a technical review covering each country’s oilfields and infrastructure to determine the volume that can be brought online within 90 days and sustained for one full year — what the group calls a country’s “maximum sustainable capacity,” Bloomberg reports, citing one of the group’s delegates.

Once each country’s capacity is assessed, the group will assign a quota that represents an equal percentage of capacity for every member. Members’ capacities will then be formally approved in an Opec+ meeting in November, where quotas for 2027 will be set. The process will be repeated annually.

A familiar face will reportedly conduct the audit: Dallas-based firm DeGolyer and MacNaughton — the petroleum consultancy that audited Aramco’s reserves ahead of its IPO — will conduct the audit, the business news service added.

…but not for everyone: Russia, Venezuela, and Iran objected to the external auditor due to the ongoing tensions and sanctions with the US. A yet-to-be-named Indian firm will reportedly audit Russia and Venezuela, while Iran chose to use its average production for August, September, and October as its baseline, according to Bloomberg.

Why does this matter now? Because quotas no longer align with reality. Many Opec+ producers simply can’t hit their targets, while a few can pump far more than their assigned limits. Twelve of the 18 members with quotas were producing below target in October, Reuters reported, citing data from Platts.

  • The new method is designed to stop the cycle of non-compliance and improve market signaling. Energy Minister Prince Abdulaziz bin Salman has recently said that the system will “stabilize markets and reward those who invest in production.”

BUT- The group has a long history of struggling to enforce discipline: Members have spent years “flagrantly exceeding production quotas,” while Saudi Arabia — the bloc’s de facto leader — struggled to impose order, Ron Bousso wrote in a Reuters column. The reform is supposed to reset expectations, reduce non-compliance, and offer a transparent explanation for quota allocations.

Rewarding the Gulf — and raising the bar for everyone else: The new baseline formula directly benefits countries that can ramp up quickly, cheaply, and reliably, clearly favoring Saudi Arabia, the UAE, and Kuwait — the lowest-cost producers in the group, Bousso said.

The figures speak for themselves: Saudi’s production capacity stands at 12 mn bbl / d, while its spare capacity reached 2.2 mn bbl / d in October — 60% of total Opec+ spare capacity, Bousso wrote, citing IEA data. Aramco extracts oil at USD 2 a barrel, one of the lowest rates in the world.

By contrast, members whose production relies on costlier reservoirs or offshore fields — notably Nigeria and Kazakhstan — are disadvantaged because boosting capacity requires more investment and longer timelines, Bousso said. Sanctioned producers also face obvious headwinds, as they cannot easily grow capacity due to restrictions on equipment, technology, financing, and even exporting.

Expect a wave of upstream investment — especially from the Gulf — as countries try to lift capacity ahead of the audits, Bousso notes. Gulf states, in particular, are already “looking beyond near-term oversupply concerns” and remain unconcerned about future demand questions, Bousso adds. The logic is simple: if your future quota is a percentage of your verified capacity, and that capacity gets locked in for 2027 and reviewed annually, you start investing now.

  • This fits the group’s long-term goal: Opec wants to regain market share after losing ground to rising non-Opec production and US shale — more capacity inside the bloc supports that.

ALSO- Positive implications for energy transition? When there’s a realistic, independently verified view of fossil fuel availability and spare capacity, it becomes easier to integrate renewables into long-term strategy and plan buildout without second-guessing supply risks, Mona Dajani, global co-chair of Energy, Infrastructure, and Hydrogen at Baker Botts, said in a post on LinkedIn.

BUT- The system still has weaknesses: Members — like Kazakhstan and the UAE — can still overproduce, as they did in recent years. Audits don’t automatically guarantee compliance, Reuters notes. Countries unable to grow capacity because of sanctions, conflict, or geological limitations will also lose market share relative to Gulf producers, which can create internal friction (A previous capacity review in 2023 led Angola to quit Opec entirely).

REMEMBER- No production hikes for 1Q 2026: Opec+ agreed to keep oil output quotas unchanged for the first quarter of 2026 in its meetings earlier this week. The decision keeps 3.24 mn bbl / d of production cuts in place, representing some 3% of global demand.

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