The most powerful player in any market is the one who can set the price and make everyone else live with it.
For half a century, one group did exactly that with oil. When it held barrels back, prices climbed. When it opened the taps, prices eased, and the rest of the world arranged its plans around the decision.
Here is how the machine was supposed to run. The Organization of the Petroleum Exporting Countries, or OPEC, and its partners would meet, agree on a production number, and the market would follow.
American drillers in the Permian Basin of Texas and New Mexico filled in around the edges. Global demand, led by China, did the rest. The cartel sat at the head of the table, and everyone else passed the dishes.
That is not the market we have today. On June 7, those same producers signed off on another increase, 188,000 barrels a day for July, the fourth month running that they have added supply, according to The National. The decision barely moved anything.
The uncomfortable part, and the one I keep landing on in my own analysis, is that the fate of the oil market no longer sits in OPEC’s hands. It moved to a shale field in West Texas, a shipping lane in the Persian Gulf, and a demand curve that is quietly flattening.
Where oil prices actually come from now
Start with the supply that OPEC does not control, because there is a lot of it.
TheStreet’s markets desk has tracked that glut for months, and J.P. Morgan now sees it building even with the war on, pegging long-term Brent near $63 and a surplus approaching three million barrels a day.
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The United States pumped a record 13.6 million barrels a day in 2025, and the Permian alone accounted for almost half of it, according to the Energy Information Administration. That is not a cartel quota. That is thousands of private wells responding to one thing, the price.
Zoom out and the picture gets starker. Non-OPEC producers supplied close to 60% of the three-million-barrel jump in global output since the start of 2025, the International Energy Agency reported. The growth came mostly from what the agency calls the Americas group, the United States, Canada, Brazil, Guyana and Argentina.
None of them sit in OPEC’s meetings. None of them take its quotas. They drill when the price works and slow down when it does not.
That is the part the old playbook never accounted for. A cartel can only swing a market it dominates, and OPEC no longer does.
Related: Nordic energy CEO sends blunt warning on oil and economy
Why OPEC’s latest oil increase changed almost nothing
Now layer in the war.
Since late February, when U.S. and Israeli forces began striking Iran, the Strait of Hormuz has been mostly closed. Roughly 20% of the world’s oil and gas moved through that channel before the fighting.
The result was a price shock OPEC could only watch. Brent crude jumped from about $73 before the war to north of $114 at the peak, and the group’s own output fell to its lowest level in more than 35 years, the International Energy Agency reported. You cannot ship oil through a strait that is closed, no matter what your quota says.
So when OPEC approved 188,000 more barrels a day for July, it was offering a teaspoon against a flood. Global supply is down nearly 13 million barrels a day since the war began.
Here is where the barrels and the power actually sit:
- U.S. crude output hit a record 13.6 million barrels a day in 2025, with the Permian supplying nearly half, per the Energy Information Administration.
- Non-OPEC producers drove almost 60% of global supply growth since early 2025, per the International Energy Agency.
- OPEC+ production fell to a 35-year low by April 2026 as the strait stayed shut, per the International Energy Agency.
- U.S. regular gas hit about $4.24 a gallon in late April, up roughly 42% since the war began, per TheStreet’s reporting on Goldman Sachs data.
Even the de facto head of the cartel admits the timeline is out of his hands. The market will not normalize until 2027 if the strait stays blocked past mid-June, Saudi Aramco chief executive Amin Nasser warned, according to CNBC.
Then the cartel lost a member. The United Arab Emirates walked out of OPEC+ on May 1, ending more than five decades inside the group, according to CNBC. When your third-largest producer decides the quota system no longer fits its plans, the table is getting smaller.
What cooling oil demand means for your money
When I ran OPEC’s July increase against the supply numbers, the math was almost insulting. The group is adding a rounding error to a market measured in tens of millions of barrels.
And the demand it is fighting over is not growing the way it used to. Global oil demand will rise by less than a million barrels a day in 2026, with China, long the engine, adding only about 200,000, well under its pace of the past decade, according to the International Energy Agency.
Efficiency standards, electric vehicles and a cooler Chinese economy are doing to oil what nobody at a quota meeting can reverse.
OPEC’s own analysts still see demand climbing by roughly 1.4 million barrels a day this year. Almost no one outside the cartel shares that math.
Before the war scrambled everything, the agency was bracing for a record surplus in 2026, a glut built mostly by barrels OPEC does not pump.
For you, this shows up in two familiar spots. The price you pay at the pump now tracks a shale breakeven near $61 a barrel and a shipping lane half a world away far more than any statement out of Vienna.
And the energy fund or oil stock in your 401(k), names like Exxon Mobil (XOM) and Chevron (CVX), is riding a war premium that can vanish the day the strait reopens. By early June, Brent had already slipped back toward the low $90s as U.S. and Iran negotiators traded offers, according to TradingEconomics.
Where the real control of oil sits now
OPEC’s next meeting is July 5, and the headlines will treat it like a verdict.
It is not. The real decision gets made in the Permian, where drillers judge every morning whether $90 oil is worth a new well, and in the Strait of Hormuz, where one mine or one missile counts for more than any production quota.
The group can still cause a spike or soften a fall. What it can no longer do is set the number and make the world accept it.
That power did not disappear. It changed hands. And the new owners, American wildcatters, Gulf shippers and a billion drivers slowly swapping gasoline for electrons, never sent an RSVP to Vienna.
