Oil production from the Organization of the Petroleum Exporting Countries (OPEC) crude oil output surged 300,000 barrels per day (b/d) in June, close to an eight-year high of 32.73 million b/d, as production in Nigeria and Libya tentatively recovered along with steady increases for Saudi Arabia and Iran, according to an S&P Global Platts survey of OPEC and oil industry officials.
OPEC’s 300,000-barrel-per-day output rise in June, boosted by fragile recoveries in Libya and Nigeria, and the unrelenting rise in Iran and the increase in Saudi Arabia, sends a strong message over its unwavering market share strategy, says Eklavya Gupte, senior editor for S&P Global Platts. If the situation persists, the case for a return to some kind of production cap may gain traction.
OPEC crude production climbs by 300,000 b/d. 150,000 b/d recovery on return of Nigeria’s Qua Iboe.
Venezuelan output sinks to 13-year lows. Venezuela acted as a check on the overall level though, as the crisis-hit country’s production continues to hit fresh lows.
The bloc’s top producer, Saudi Arabia, increased its output further to produce an average 10.33 million b/d in June in order to meet domestic demand.
Last summer, Saudi Arabia produced as much as 10.45 million b/d.
A spike in air-conditioning demand has traditionally boosted the volume of crude burned directly in the kingdom’s power plants during the summer months. In addition, domestic refining also picked up.
The sharp increase in OPEC’s June production affirms a continuation of its market share strategy.
Meanwhile, OPEC added a new member in July, Gabon, and next month Nigeria’s Mohammed Barkindo will take over as the group’s secretary general.
This comes at a critical juncture for OPEC, after a spate of infighting and disagreements. Analysts said these two decisions which were taken at the June meeting could lay the groundwork for future cooperation on bigger issues.
