Hello,

As our readers likely know all too well, the world of finance is filled with acronyms. While designed to improve efficiency in communication, they can often cause confusion and act as a literacy barrier to the general public. One such acronym that often appears in the economic world is OPEC, which stands for the Organisation of the Petroleum Exporting Countries. It’s made up of 12 countries from the Middle East and Africa (with the exception of Venezuela) who together produce approximately 30-40% of the world’s oil.

 

OPEC’s mission is to coordinate petroleum production among its members to ensure stable oil prices and sufficient supply – activities which could be perceived as being anti-competitive. However, the member nations have state immunity from antitrust laws, despite the efforts of the failed NOPEC act (less of an acronym, more of a pun) which the US Senate passed in 2022 to enforce competition laws on the organisation.

 

As a unified entity, OPEC has a large influence over the price of oil. This has been visible in 2025 with a series of announced plans to ramp-up oil production. The OPEC nations are seeking to regain market share, while the new US administration have also pledged to “drill, baby, drill” in the meantime. Both of which have heavily contributed to volatility and a 23% drop in the price of liquid gold so far this year.

 

As always, if you wish to discuss anything in this newsletter in further detail, please do get in touch.