Iraq has warned that it may reconsider its membership in the Organization of the Petroleum Exporting Countries (OPEC) unless the group grants it a substantially higher oil production quota. The warning comes only a few months after the United Arab Emirates (UAE) exited the organisation in April, citing similar concerns over production restrictions.
OPEC, established in Baghdad in 1960 by Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela, is a coalition of major oil-producing nations that coordinates output policies to influence global energy markets. Although decisions are made collectively, Saudi Arabia exerts significant influence as the organisation’s largest producer and is widely regarded as its de facto leader.
In recent years, Saudi Arabia has advocated production restraint to support oil prices, a position that has generated friction with countries seeking greater output allowances. Iraq has now become the latest member to challenge the existing quota system.
According to Iraqi Oil Ministry spokesperson Salim Al-Rikabi, Baghdad believes its current production allocation does not adequately reflect its oil-producing capacity or economic requirements. He stated that OPEC should increase Iraq’s production ceiling and suggested that failure to do so could force the country to evaluate whether remaining in the organisation serves its interests.
OPEC regulates member output through production quotas that are periodically adjusted based on market conditions and global demand. Iraq’s dissatisfaction stems from these limits, which it argues prevent the country from fully utilising its production potential.
The dispute comes amid ongoing discussions within OPEC+ regarding future production targets. Reports indicate that Iraqi officials have privately considered the possibility of leaving the organisation if substantial quota increases are not granted. One senior official reportedly stressed that Iraq’s concerns should be treated with utmost seriousness, although he acknowledged that any decision to leave remains under consideration rather than official policy.
As OPEC’s second-largest producer, with output of approximately four million barrels per day, Iraq has long maintained that its production restrictions are inconsistent with its capabilities. Since the formation of OPEC+ in 2016, Baghdad has repeatedly argued for higher quotas, citing the need for increased revenues to rebuild an economy affected by decades of conflict, sanctions, and instability.
Iraqi officials have also pointed to economic pressures arising from recent regional tensions, including the US-Iran conflict, as reasons for seeking greater production flexibility. Higher oil exports, they argue, are essential for addressing fiscal challenges and supporting national development.
The current dispute resembles the issues that led to the UAE’s departure from OPEC earlier this year. Before leaving, Abu Dhabi argued that its quota failed to reflect investments it had made to expand production capacity. UAE officials also sought greater freedom to monetise oil reserves before the global energy transition potentially reduces future demand for fossil fuels.
Iraq is making a comparable case, insisting that its production limits should better align with both its capacity and its economic priorities. The country has stated that decades of war, sanctions, and recent regional disruptions have created a pressing need for additional oil revenues.
Officials have also indicated that Iraq aims to restore and expand its export capabilities. Government spokesperson Haider al-Aboudi reportedly said the country intends to increase production to seven million barrels per day over the coming years, a target that would require substantially higher quotas than those currently permitted under OPEC arrangements.
Despite the strong language, Iraqi authorities have emphasised that they remain committed to working within OPEC for the time being. However, analysts note that even the suggestion of a potential departure could be intended to strengthen Baghdad’s negotiating position ahead of quota discussions.
An Iraqi withdrawal would represent a significant setback for OPEC. The organisation has already faced challenges from rising production by non-OPEC countries, particularly the United States, which has become the world’s largest oil producer due to the growth of shale oil extraction. The recent departure of the UAE and broader geopolitical tensions have further complicated OPEC’s efforts to manage global supply.
OPEC’s influence relies on its ability to coordinate production among member states and thereby affect global oil prices. If major producers operate independently or leave the organisation altogether, the group’s capacity to regulate supply and stabilise markets is diminished.
The prospect of Iraq leaving is particularly significant because the country was one of OPEC’s five founding members and remains its second-largest producer. Such a move would not only reduce OPEC’s share of global oil output but also carry symbolic importance, raising questions about the organisation’s cohesion and long-term influence in an increasingly competitive energy market.
Analysts have warned that further divisions within OPEC could heighten the risk of future price competition among producers, especially at a time when oil markets are already well supplied and prices have retreated from levels reached during recent regional conflicts. Iraq’s warning therefore represents not only a challenge to OPEC’s quota system but also a broader test of the organisation’s ability to maintain unity among its members.
