OPEC’s Oil Production Rose in February Despite Cut Extension
Despite the voluntary production cuts of several major producers of the OPEC+ alliance, OPEC’s oil production rose in February by more than 200,000 barrels per day (bpd) compared to January, driven by higher production in Libya, which is exempted from the OPEC+ supply cuts.
Crude oil production from all OPEC members jumped by 203,000 bpd from January to 26.57 million bpd in February, OPEC’s Monthly Oil Market Report (MOMR) showed on Tuesday.
The biggest increase in output came from Libya, which has been exempt from the OPEC+ cuts due to its unstable security situation, as well as from Nigeria, which has underperformed compared to its quotas in recent years, due to a lack of investments and frequent sabotages and theft on onshore pipelines.
Libya has restored oil production at its largest oilfield, Sharara, which was shut down for three weeks in January by protesters.
In February, Libya’s oil production rose by 144,000 bpd, while Nigeria’s output increased by 47,000 bpd compared to January.
OPEC’s top producer, Saudi Arabia, produced 8.98 million bpd last month, in line with its pledge to keep output at about 9 million bpd after promising a 1-million-bpd cut that has been in place since last summer.
But the second-biggest producer of the cartel, Iraq, pumped around 200,000 bpd more than its pledge to keep production at 4 million bpd, as it only reduced output by 14,000 bpd, according to the secondary sources in OPEC’s report. Iraq’s oil production averaged 4.2 million bpd last month, per the sources.
Some OPEC+ producers, including Saudi Arabia, Iraq, Kuwait, the United Arab Emirates (UAE), and Algeria, announced earlier this month they would roll over their production cuts – initially for the first quarter – into the second quarter, too. They are joined in this OPEC+ effort by non-OPEC producers Russia, Kazakhstan, and Oman.
By Charles Kennedy for Oilprice.com