OPEC Oil Output Falls as Venezuela Disruptions Hit Supply
Crude oil production from the Organisation of the Petroleum Exporting Countries (OPEC) declined in January 2026, with total daily output falling into a range of roughly 28.3 million to 28.8 million barrels per day (bpd), down by as much as 230,000 bpd from December levels, according to industry surveys and market analysts.
Key Takeaways
- OPEC oil output fell in January 2026, dropping to around 28.3–28.8 million barrels per day.
- The decline was driven mainly by Venezuela’s political turmoil and export blockades, with additional losses in Nigeria and Libya.
- Despite the dip, the International Energy Agency still expects a global oil supply surplus in 2026 due to rising non-OPEC production.
The contraction was driven by a combination of political disruption and operational challenges across key member states, with Venezuela, Nigeria, and Libya all contributing to the drop in supply.
Political upheaval in Venezuela took centre stage. A U.S.-led intervention in early January that resulted in the capture of President Nicolás Maduro triggered a de facto blockade of Venezuelan oil exports, causing crude shipments to slump sharply in the opening weeks of the year. Nigeria also recorded significant declines, with sharp reductions in production reportedly the largest among OPEC members in some tracking reports. Libya’s output was constrained by adverse weather that delayed tanker loadings at coastal terminals.
Iran, already under renewed sanctions pressure from Washington following a domestic crackdown on protests, continued to see its production trend lower, adding to overall supply weakness.
Policy Decisions and Output Strategy
The production figures come amid careful deliberations within the wider OPEC+ alliance of oil exporters. Eight member nations, including heavyweights Saudi Arabia and Russia, met in early January and confirmed a decision to pause planned increases in crude output for the first quarter of 2026, citing seasonally softer global demand and a desire to support market balance.
Several OPEC+ participants such as Iraq, the United Arab Emirates, and Kazakhstan have also pledged additional supply cuts between January and June 2026 to make up for earlier overproduction, according to industry sources.
Market Outlook Amid Surplus Forecasts
Despite the decline in OPEC production, the International Energy Agency (IEA) has signalled that the global oil market is expected to remain oversupplied through 2026. In its January oil market report, the agency forecast a substantial surplus in the first quarter of the year, with supply outstripping demand by more than 4 million bpd — equivalent to roughly 4% of global consumption.
That anticipated excess, driven in part by booming volumes from non-OPEC producers such as the United States, Brazil, and Guyana, suggests the global crude market could remain under downward price pressure even as geopolitical risks persist.
Prices and Sector Reaction
Oil prices have reflected these mixed signals. While geopolitical risks in the Middle East and Venezuela have provided some underlying support, broader forecasts of oversupply have kept upward momentum in check.
Analysts say OPEC+ policymakers will be watching early-year demand trends closely, with potential for further strategic adjustments later in 2026 depending on market developments.
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