Venezuela Considers Leaving OPEC Amid Fragmentation Fears

Venezuela is considering leaving OPEC, the decades-old oil producer group it helped establish more than six decades ago. The move comes just months after the UAE withdrew from the organization and as Iraq has signaled dissatisfaction with its production limits.

The potential departure would have little immediate impact on global oil supplies, but could further undermine OPEC's cohesion and influence over crude prices. Traders and analysts say it could increase competition among producers for customers and market share while reducing OPEC's ability to manage periods of excess supply.

Venezuela holds some of the world's largest oil reserves and its departure would remove more than 5 MMbpd of production capacity from the organization, equivalent to roughly 17% of the capacity held by core members at the beginning of 2026. The UAE announced its withdrawal in April after years of frustration over production limits that constrained its expanded capacity.

OPEC is already facing challenges from rising production in countries like the US, Brazil, and Guyana, as well as the war in Iran which has forced Saudi Arabia and other Gulf producers to curb output. Russia's influence on OPEC has also weakened due to its exports being affected by the war in Ukraine.