Does OPEC impact Oil Trading Prices?
Oil trading prices are determined by several factors, one of which is the decisions taken by OPEC. The Organization of the Petroleum Exporting Countries, or OPEC, is an intergovernmental organization comprising of 13 oil producing nations.

OPEC’s mission is to “coordinate and unify the petroleum policies of Member Countries and ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers and a fair return on capital to those investing in the petroleum industry.”

How OPEC impacts Oil Trading Prices
Oil trading prices are directly impacted by the actions and decisions of OPEC. This is due to:

1. The strength of OPEC - OPEC nations account for more than 60% of the world’s oil reserves. They also account for more than one-third of the world’s oil production. This allows OPEC to have a major influence over the global oil market and oil trading prices.
2. OPEC’s production quota - OPEC has a crude output quota system, which is also known as “production target.” Decisions to increase or cut this quota influence oil trading prices. For instance, if demand surges, OPEC may decide to increase its oil production, preventing a sudden spike in oil trading prices. Depending on market conditions, OPEC may reduce its oil production, exerting upward pressure on oil trading prices.
3. The ORB - OPEC has a basket of twelve crude oils. This is known as the OPEC Reference Basket, the ORB or the OPEC Basket. It is a weighted average of prices for crude blends produced by OPEC nations. This forms a significant benchmark for oil trading prices.
4. OPEC’s influence over oil trading prices has reduced to some extent, following the discovery and development of significant oil reserves in the North Sea and the Gulf of Mexico.

As oil prices can move rapidly, those looking to trade oil should join a platform that has live-streaming quotes.