OPEC Output Drops in July After Iraq Fails to Repeat Record June Highs

by Ship & Bunker News Team
Tuesday August 4, 2015

The July output of the Organization of Petroleum Exporting Countries (OPEC) sank to 32.107 million barrels a day (bpd), a decline of 362,000 barrels, a Bloomberg survey states.

This is compared to 32.469 million bpd in June, and analysts say the drop is due to production in Iraq, OPEC's second biggest producer, slipping from a June record to 4.194 million barrels last month (194,000 barrels a day).

By comparison, the output of OPEC's largest producer, Saudi Arabia, increased by 70,000 bpd to 10.57 million last month; Iran's production was steady at 2.85 million barrels; and Libyan production declined by 20,000 barrels daily to 380,000.

Despite the easing of production, there is still widespread speculation that the global supply glut will grow, and Brent crude Monday fell almost 5 percent to break the $50 mark for the first time since January 2015.

John Kilduff, a partner at Again Capital LLC, told Bloomberg that as a result of OPEC retaining its target daily output of 30 million bpd, Brent crude prices "are going to remain under pressure because output is near record levels in several OPEC countries."

Meanwhile, Bloomberg notes that despite impact on prices, Iran will focus on regaining market share now that it has reached a nuclear accord with the P5+1 countries. 

The nation aims to produce almost 4 million barrels daily within seven months of the economic sanctions being removed and increase to 4.7 million after that, according to Bijan Namdar Zanganeh, Iran's oil minister.

Last month, analysts speculated that while OPEC would continue its current output levels to defend its market share, some OPEC countries may renew demands to cut supplies as a result of the price drop.

Ship & Bunker News Team
To contact the editor responsible for this story email us at editor@shipandbunker.com