The oil cartel that has shaped global energy markets for over six decades is watching its grip slip. A growing wave of defiance against OPEC production quotas, headlined by Iraq’s potential departure from the group, has major Wall Street banks warning that crude prices could tumble below $50 a barrel.
That would represent a roughly 25% decline from recent levels, the kind of move that reshapes entire economies, kills drilling projects, and sends energy stocks into freefall.
The cracks in the cartel
Iraq’s threat to leave OPEC has been described as a “final nail in the cartel’s coffin.” The country has long chafed under production quotas it views as unfairly restrictive, and a full exit would mark the most significant departure from the organization in years.
Iraq isn’t just any member. It’s OPEC’s second-largest producer. If Baghdad walks, it doesn’t just remove one country from the agreement. It gives every other restless member a template for doing the same.
