Opec+ market share to fall as US ramps up oil output

February 18, 2025, 2:03 PM

An oil production facility in the Texas Permian Basin. US oil is set to take a greater market share from Opec+ members

Market share was 53%
Set to drop to 46%
US not bound by quotas

Opec+ members’ market share is likely to shrink this year and in 2026 as non-Opec supply led by the US accelerates, according to energy experts.

The Opec+ group’s market share was 53 percent when it was set up in 2016. That figure is likely to drop to 46 percent in 2025 and 2026, even as Opec+ gradually reverses 2023 cuts in production quotas and actually increases supply, according to the US Energy Information Administration (EIA).

Opec+ supply is expected to grow by 100,000 barrels per day this year to 35.8 million bpd and by 600,000 bpd next year. Unlike the Opec+ members, the US is not subject to quotas.

“Opec+ has to resume executing its initial plan, pumping back (oil), at least to hold back part of the market share it is losing,” Choeib Boutamine, CEO of Ranadrill Consulting, a training and consulting company in Algeria, told AGBI.

“If Opec+ doesn’t take back its share, someone else will.”

Voluntary cuts of 2.2 million bpd announced in November 2023 are set to be phased out between March this year and September next. Cuts announced in April last year will in principle remain in place until the end of next year.

This could change, however. Opec+ might postpone increases in supply as the price of oil declines, sources told Bloomberg.

Opec has 12 members led by Saudi Arabia, while Opec+ includes Russia, Oman, Kazakhstan, Brazil, Azerbaijan, Bahrain, Mexico, Malaysia, Sudan and South Sudan.

Opec+ members' market share could be squeezed even further, according to experts.

“Sanctions on Russia and Iran are the reason behind it,” said Ali Al Riyami, a former director of marketing at Oman’s ministry of energy and minerals. Unwinding earlier quota cuts will help the group retain its market position, he added.

Iran, an Opec member not subject to quotas, produced nearly 3.3 million bpd in January. Its exports averaged 1.5 million bpd in 2024.

The US aims to cut Iranian oil flows by more than 90 percent, it has said.

“We are committed to bringing the Iranians back to the 100,000 barrels a day of oil exports” shipped during President Donald Trump’s first term, treasury secretary Scott Bessent told Fox Business last Friday.

The EIA expects world production to increase by 1.9 million bpd this year and 1.6 million bpd next year, driven by four countries in the Americas – the US, Guyana, Canada and Brazil.

Trump's energy policy is to maximise domestic energy output and increase US oil hegemony. He will “put all the means to dominate any share”, said Boutamine.

Since returning to the Oval Office, he has formed an energy council led by Doug Burgum, the secretary of the interior, and reopened more than 600 million acres of offshore federal waters for oil and gas development, reversing restrictions imposed under President Joe Biden.

US oil production increased to 13.2 million bpd last year despite a drop in rig numbers. Since the start of this year, oil drilling companies have pointed to increased activities in the US.

Most of the growth is in the Permian Basin in the southern US, in Hinesville in Georgia, and other centres for unconventional oil and gas.

According to EIA, the Permian Basin will account for about 50 percent of US oil production next year. “Growth in the Permian offsets contractions in other regions,” it said.