Every time oil prices spike, the same question appears in financial coverage: what will OPEC do about it? For fifty years, OPEC has been the closest thing the oil market has to a circuit breaker — the group of major producing nations that can, in theory, open or close the taps to stabilize prices.
So why, with crude at $91/barrel and climbing, has OPEC+ not ridden to the rescue?
What OPEC+ Actually Is
OPEC — the Organization of the Petroleum Exporting Countries — was founded in 1960 by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela. The original idea was simple: coordinate production among major exporters to maintain price stability and maximize collective revenue.
The "+" was added in 2016 when OPEC expanded its coordination to include Russia and nine other non-OPEC producers. The expanded group controls roughly 40% of global oil production and an even larger share of proven reserves.
The way it works in practice: member countries meet periodically and agree on production quotas. When prices are too low, they cut production to push prices up. When prices spike and political pressure mounts, they can increase production to push prices down. Saudi Arabia is the critical player — it has the largest spare production capacity of any country.
Why This Crisis Is Different
In a normal oil price spike — a hurricane disrupting Gulf Coast refinery capacity, or a cold snap driving heating demand — OPEC+ is a functional relief valve. Saudi Arabia opens the taps, additional supply enters the market within weeks, and prices moderate.
The Hormuz situation breaks that mechanism in a specific way: the problem is not production, it is transit.
The oil is being produced. It is coming out of the ground in Saudi Arabia, the UAE, Iraq, and Kuwait at normal or near-normal rates. The problem is that a significant portion of it cannot get to market because the primary shipping route — through the Strait of Hormuz — is disrupted. OPEC+ can agree to produce more — but if there is nowhere for the tankers to go, producing more does not help.
The Backdoor Routes and Why They Are Not Enough
The East-West Pipeline (Saudi Arabia):
Moves crude from the Eastern Province to the Red Sea port of Yanbu, bypassing Hormuz entirely. Maximum capacity: approximately 5 million barrels per day. It is already running near full capacity.
The Abu Dhabi Crude Oil Pipeline:
Moves Emirati crude to the port of Fujairah on the Gulf of Oman, also bypassing Hormuz. Capacity: about 1.5 million barrels per day.
Combined, these pipelines can move roughly 6-6.5 million barrels per day outside of Hormuz. The disrupted traffic through the strait is estimated at 15-18 million barrels per day. The bypass capacity covers perhaps a third of what is being disrupted. The rest has to wait.
What OPEC+ Could Do
• Redirect bypass capacity to highest-value customers. This is happening. It does not move the price needle significantly.
• Saudi Arabia can signal willingness to flood the market once Hormuz reopens. Even before it physically adds barrels, a credible commitment softens futures prices. This is one reason prices have not already hit $100.
• Lobby for diplomatic resolution. OPEC+ members have significant back-channel communication with all parties. This diplomatic role is probably more valuable than their production role in this specific crisis.
• What it cannot do: Add meaningful new supply to global markets while Hormuz remains disrupted. The production is there. The transit capacity is not.
The One Scenario Where OPEC+ Makes a Real Difference
If the Hormuz situation resolves, Saudi Arabia could move quickly to increase production and ensure prices retreat sharply. A pre-positioned commitment to do so upon resolution would accelerate the market's pricing of that outcome — functioning as a market signal today, even before a single additional barrel flows.
Until that signal comes, OPEC+ is largely a spectator to a crisis it did not create and cannot independently solve.
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Sources: OPEC Annual Statistical Bulletin, EIA international energy data, International Energy Agency Oil Market Report.