OPEC+ crude output dropped by 300,000 b/d to 40.73 million b/d in August, largely due to production issues in Libya and Kazakhstan. Nations exceeded production targets by 327,000 b/d, while concerns about overproduction and falling prices continue. With OPEC and its allies delaying the rollback of production cuts until December, the market remains tense as stakeholders await further developments.
In August, OPEC+ crude production declined by 300,000 barrels per day (b/d), totaling 40.73 million b/d, according to the Platts OPEC+ survey conducted by S&P Global Commodity Insights. This reduction was primarily attributed to maintenance activities in Kazakhstan and production outages in Libya. Despite the decrease in output, member countries with production quotas still exceeded their targets, producing 327,000 b/d above the set limits, although this was a decrease from the 437,000 b/d overshoot recorded in July. The survey indicated that OPEC’s production fell by 120,000 b/d to 26.77 million b/d, while non-OPEC partners reduced output by 180,000 b/d, bringing their total to 13.96 million b/d. Libya experienced the most significant drop within OPEC, contributing a decrease of 160,000 b/d due to political disputes leading to shutdowns, resulting in an output of 990,000 b/d. In the non-OPEC sector, Kazakhstan faced the largest reduction, with its Tengiz field maintenance leading to a cut of 120,000 b/d to 1.45 million b/d. Kazakhstan, alongside Iraq, has consistently produced more than its quota throughout 2024, with both nations committing to rectify their overproduction by the end of September 2025. Iraq’s output remained stable in August at 4.33 million b/d, notably exceeding its quota of 3.93 million b/d. Russia, as the largest non-OPEC producer, reduced its output by 50,000 b/d to 9.05 million b/d, also remaining above its quota of 8.98 million b/d, while Saudi Arabian production remained unchanged at 8.99 million b/d. The continuous overproduction by OPEC+ has adversely affected oil prices through the summer months. On September 6, Dated Brent was assessed at $73.025 per barrel, marking a significant decline from the peak prices of over $93 per barrel observed in early April. In light of these developments, OPEC and its allies recently decided to postpone the gradual rollback of 2.2 million b/d of voluntary cuts by two months, rescheduling the initiation to December based on prevailing market conditions. Following this announcement, oil prices experienced further declines, assessed at $75.225 per barrel on September 4. The Joint Ministerial Monitoring Committee, responsible for overseeing production agreements, is scheduled to convene on October 2, with a comprehensive ministerial meeting set for December 1 in Vienna. The Platts survey utilizes methodical data collection from oil industry officials, traders, and analysts to compile accurate production insights from shipping, satellite, and inventory assessments.
The article provides an analysis of the latest OPEC+ production data, highlighting declines in output due to specific geopolitical and operational challenges faced by member countries. Given the fluctuating global oil prices and the strategic decisions of OPEC+, understanding these dynamics is crucial for industry stakeholders. The information is sourced from the Platts OPEC+ survey, which captures comprehensive wellhead production data influenced by various market conditions.
In summary, OPEC+ has experienced a notable decline in crude production for August primarily due to maintenance and geopolitical issues arising from Libya and Kazakhstan. Despite this reduction, member countries have continued to exceed their production quotas, leading to ongoing concerns about overproduction and its implications for global oil prices. The group’s decision to postpone the rollback of voluntary cuts underscores the complexities in managing production levels amidst fluctuating market demands. Stakeholders will be closely monitoring developments ahead of the upcoming meetings set for October and December.
Original Source: www.spglobal.com
