In July, the oil supply from OPEC+ saw a significant dip of 1.2 million bpd, bringing the total to 50.7 million bpd— its lowest in nearly two years.
This decrease is attributed to Saudi Arabia’s decision to unilaterally slash its production by one million bpd, as highlighted in the International Energy Agency’s (IEA) August Oil Market Report. Since the beginning of the year, OPEC members reduced their oil production by over 2 million bpd, while non-OPEC+ oil producers ramped up their production by 1.6 million bpd, totalling 50.2 million bpd.
However, the IEA anticipates that the non-OPEC+ producers’ growth rate will slow for the remaining part of the year.
A more detailed glance reveals that OPEC’s overall oil production descended by 836,000 bpd, settling at 27.31 million bpd in July. The significant drop of 968,000 bpd in Saudi Arabia’s output was the major cause, as the country almost met its self-imposed cut of 1 million bpd. This sharp reduction now positions Russia, OPEC+’s main ally, ahead of Saudi Arabia in terms of crude oil production.
On the global front, July saw an overall reduction in oil supply by 910,000 bpd, resulting in 100.9 million bpd. Interestingly, this fall was despite a 310,000 bpd increase from non-OPEC+ contributors, primarily due to Saudi Arabia’s cuts.
Information for this briefing was found via Reuters and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.