OPEC output peaks amid outages
The oil output of the Organisation of Petroleum Exporting Countries (OPEC) has risen this month to it highets as Gulf members pumped more after a deal to ease supply curbs and Congo Republic joined the group. This is even as losses from Iran and Libya constrained the increase.
The OPEC has pumped 32.64 million barrels per day in July, a Reuters survey found yesterday found, up 70,000 bpd from June’s revised level and the highest this year with Congo added.
OPEC and allies agreed last month to boost supply as U.S. President Donald Trump urged producers to offset losses caused by new U.S. sanctions on Iran and to dampen prices, which this year hit $80 a barrel for the first time since 2014.
On June 22-23, OPEC, Russia and other non-members agreed to return to 100 per cent compliance with oil output cuts that began in January 2017, after months of underproduction in Venezuela and elsewhere pushed adherence above 160 per cent.
Saudi Arabia said the decision would translate into an output rise of about 1 million bpd.
OPEC’s collective adherence with supply targets has slipped to 111 per cent in July from a revised 116 per cent in June, the survey found, meaning it is still cutting more than agreed.
Following the OPEC decision, Kuwait and the United Arab Emirates raised output by 80,000 bpd and 40,000 bpd respectively in July, the survey found.
The bulk of the Saudi supply boost appears to have been delivered in June as Riyadh tapped storage tanks to push supply to 10.60 million bpd, near a record high. The increase infuriated Iran and surprised other OPEC members with its scale.
Riyadh has boosted supply in July by a further 50,000 bpd from June’s revised level, the survey found, because domestic crude use in refineries and power plants has risen while exports have held close to June’s rate.
Supply in Nigeria, often curbed by unplanned outages, rose by 50,000 bpd. Royal Dutch Shell’s Nigerian venture lifted force majeure on Bonny Light crude exports. Nigeria and Libya were exempt from the original supply-cutting deal.