Total production up 172.6 MBOPD
OPEC released its Monthly Oil Market Report today, outlining the state of the oil trade and the effects of the group’s output cuts. Total OPEC oil production increased in July, by 172.6 MBOPD, which does not help
Like last month, this month’s MOMR reports that Libya showed the largest increase in oil production in July. The North African producer pumped just over 1 MMBOPD, up from 874 MBOPD produced in June. Nigeria also added a significant amount of production in July, adding 34 MBOPD. Both of these countries are not part of the output cut agreement, and are continuing to bring production online after disruptions earlier in the year.
Nigeria approaching production cap
Nigeria is currently producing 1,748 MBOPD, approaching the 1,800 MBOPD level where a production cap will likely be imposed by the rest of OPEC. Libya, on the other hand, is not likely to have restraints in production put in place, and is growing quickly. The country has added about 275 MBOPD since May alone. Libya still has occasional supply disruptions, like the temporary shutdown of the Sharara field on Monday, but in general operations are going more smoothly now than in the past year.
Source: EnerCom Analytics
Among the OPEC members subject to the production cut, the overall news is good. Iraq, which has been producing significantly beyond its obligations, reduced production by 33 MBOPD in July. While this is not enough to bring the country into full compliance with the cut agreement, it is certainly a positive step. Angola and Venezuela also both reduced production in July, by a combined 35 MBOPD.
Some other countries increased production, with Saudi Arabia foremost among them, but overall OPEC production among countries covered by the cut agreement decreased by 32 MBOPD. This is a good sign, as cut compliance fell last month.
