Oil production output by the Organisation of the Petroleum Exporting Countries (OPEC) fell in July as outages curbed Nigerian supply.
The decline was also caused after Saudi Arabia made an additional voluntary cut as part of the OPEC+ producer group’s latest agreement to support the market.
The OPEC has pumped 27.34 million barrels per day (bpd) in the month in review, down 840,000 bpd from June which is the lowest since September 2021 according to Reuters surveys.
Saudi Arabia pledged to cut output by one million bpd in July as part of OPEC+’s deal in June which limits supply into 2024. Oil has begun to rally in response, with Brent crude trading above USD 85 a barrel, up from near USD 71 in late June.
The Saudi move, which Energy Minister Prince Abdulaziz bin Salman called a “Saudi lollipop,” came on to top of earlier voluntary cuts that Riyadh and several other members of OPEC+ had announced, and added to reductions made under a late 2022 OPEC+ agreement.
Increases in Angola and Iraq due to higher exports limited the decline in OPEC output in July, the survey found.
OPEC’s output is still undershooting the targeted amount by almost one million bpd partly because Nigeria and Angola lack the capacity to pump as much as their agreed level.
Saudi Arabia lowered output by 860,000 bpd month-on-month, the survey found.
Figures from Kpler show crude exports down over 600,000 bpd month-on-month, although another tanker tracker found a smaller export decline.
The second-biggest decline was in Nigeria where Shell suspended loadings of Forcados crude due to a potential leak at the export terminal. Libyan output edged lower due to a brief stoppage at some fields due to a protest.
