Ending Energy Inequality: The Need for a Multilateral Oil Buyers’ Club

The world is facing a deepening energy crisis marked by extreme market inequities, where wealthier nations and consumers are outbidding poorer populations for access to oil, worsening global inequality and economic instability, according to a new analysis published by Project Syndicate.

The analysis, authored by economists Isabella M. Weber and Gregor Semieniuk, argues that without coordinated international intervention, market allocation of oil will continue to produce grossly unjust outcomes, particularly harming low-income countries and vulnerable populations who cannot compete in bidding wars for scarce energy supplies.

As of April 2026, global oil markets remain tight due to a combination of geopolitical tensions, production constraints, and uneven recovery from past demand shocks. The authors note that price spikes disproportionately affect developing economies in the Global South, where energy imports consume a larger share of national income and household budgets, increasing the risk of inflation, social unrest, and balance-of-payments crises.

To counter this trend, Weber and Semieniuk propose the creation of a multilateral oil buyers’ club — a cooperative mechanism among importing nations designed to collectively negotiate purchases, enforce a price ceiling on global oil transactions, and allocate supplies based on essential needs rather than purchasing power.

Such a buyers’ club would function similarly to existing producer cartels but on the demand side, giving consuming countries greater leverage in global markets. By pooling purchasing power, member states could counteract price manipulation, reduce volatility, and ensure that oil flows first to critical sectors like healthcare, food production, and transportation, especially in poorer countries.

The proposal draws attention to historical precedents where coordinated buyer action has influenced commodity markets, including strategic petroleum reserve releases by the International Energy Agency (IEA) and collective bargaining efforts during past oil shocks. However, the authors stress that a permanent, rules-based buyers’ club would offer more structural resilience than ad hoc responses.

Key potential participants could include European Union member states, which have already demonstrated interest in collective energy procurement following the 2022 energy crisis; countries in Latin America and Africa seeking relief from volatile import bills; and Asian economies looking to stabilize energy costs for manufacturing and urban populations.

The United States, while a major oil producer and consumer, has shown mixed interest in demand-side coordination in recent years, though the Biden administration has previously engaged in strategic reserve releases to curb prices. The authors suggest that shifting geopolitical alignments and renewed focus on energy security could create openings for U.S. Participation in such a framework.

Iran and other sanctioned oil producers could also be indirectly affected by a buyers’ club, as reduced reliance on spot market purchases might diminish the impact of sanctions evasion tactics or premium pricing linked to geopolitical risk. However, the proposal’s success would depend on broad participation from major importers to ensure market influence.

Critics of the idea warn that enforcing a price ceiling could discourage investment in oil production or lead to supply shortages if not carefully calibrated. The authors acknowledge these risks but argue that the current system already fails to deliver adequate investment in a timely and equitable manner, particularly for renewable energy transitions in poorer nations.

Weber and Semieniuk emphasize that an oil buyers’ club should not be viewed in isolation but as part of a broader strategy to decouple essential energy access from market speculation, especially amid accelerating climate change and increasing frequency of supply disruptions linked to conflict and extreme weather.

The proposal comes at a time when global energy governance remains fragmented, with no existing institution possessing the mandate or authority to manage demand-side coordination at scale. While organizations like the OPEC Secretariat and the IEA monitor markets, neither has the power to enforce binding allocation rules among consumers.

Establishing such a club would require diplomatic negotiation, transparency in procurement practices, and mechanisms to prevent free-riding or non-compliance. The authors suggest that initial steps could include pilot programs among willing nations, data-sharing agreements, and joint tendering for crude oil contracts under agreed-upon price benchmarks.

As energy insecurity continues to fuel economic strain and geopolitical tension, the call for a multilateral oil buyers’ club represents a pragmatic attempt to rebalance power in global commodity markets — not to eliminate market forces, but to ensure they serve the broader public interest, particularly during times of crisis.