The Organization of the Petroleum Exporting Countries (OPEC) saw its oil production plummet in August, reaching the lowest levels since January, according to a Reuters survey released Monday. The decline was primarily attributed to disruptions in Libyan supply and continued voluntary cuts by other OPEC+ members.
OPEC’s total output dropped by 340,000 barrels per day (bpd) in August compared to July, averaging 26.36 million bpd.This marked the lowest production level since the beginning of the year.
The most significant contributor to the decline was Libya, where production fell by a substantial 290,000 bpd due to political tensions and disruptions at key oil fields. The standoff between rival political factions over the central bank’s control has had a severe impact on the country’s oil exports.
Other factors contributing to the overall decrease included lower exports from Iraq and Iran. Iraq, which is seeking to improve its compliance with OPEC targets, reduced its exports in August. Meanwhile, Iran, although exempt from OPEC+ production agreements, has been boosting exports in recent years despite ongoing U.S. sanctions.
Despite the overall decline, some countries, such as Nigeria, increased their output. Nigeria’s exports rose slightly in August, contributing to the overall OPEC production figures.
The Reuters survey, which is based on shipping data, company information, and sources within OPEC, revealed that OPEC members exceeded their implied production target by approximately 220,000 bpd. Iraq was the primary contributor to this excess.
The ongoing turmoil in Libya and the continued efforts of OPEC+ members to manage global oil supply have significant implications for the energy market. As the situation evolves, it remains to be seen how these factors will impact future oil prices and global energy dynamics.