OPEC+ Likely to Freeze or Slightly Increase Oil Production... Saudi Oil Output Hits Highest in 2 Years

[Photo by Reuters-Yonhap News]

[Asia Economy Reporter Park Byung-hee] The Organization of the Petroleum Exporting Countries (OPEC) and the OPEC+ coalition, which includes major non-OPEC oil-producing countries such as Russia, are reportedly considering freezing or slightly increasing oil production at their ministerial meeting on the 3rd (local time), according to the Wall Street Journal (WSJ) citing sources on the 2nd.

According to the sources, due to the growing risk of a global economic slowdown, OPEC+ plans to take time to observe whether energy demand will decline. Russia’s preference for higher oil prices to compensate for export losses caused by Western sanctions is also a factor reducing the likelihood of OPEC+ increasing production.

Haitam Al-Ghais, the newly appointed OPEC Secretary General who took office on the 1st, emphasized in an interview with Kuwait daily Al-Rai on the 31st of last month that Russia is an important strategic partner of OPEC. Secretary General Al-Ghais stated, "Maintaining Russia’s membership in OPEC+ is essential for the success of the production agreement."

According to an evaluation report commissioned by OPEC from an external agency, OPEC+ produced about 3 million barrels less oil than the production target of 42 million barrels per day set in May. The shortfall in production is due to a decrease in Russian oil output caused by Western sanctions, as well as chronic production disruptions in some member countries such as Nigeria and Angola.

However, Bloomberg News reported that major OPEC members such as Saudi Arabia and the United Arab Emirates (UAE) have recently increased their oil production. Bloomberg’s own tally of OPEC production showed that OPEC’s daily output in July was approximately 29.05 million barrels, marking the highest production level in about two years. OPEC’s production increased by 270,000 barrels compared to June, with about two-thirds of the increase attributed to Saudi Arabia.

Saudi Arabia increased production by 180,000 barrels in July, producing 10.78 million barrels of oil per day. Bloomberg explained that 10.78 million barrels is the highest daily production since April 2020 and an unusually large volume for Saudi Arabia.

The UAE and Kuwait were also confirmed to have significantly increased their output. The UAE produced 3.24 million barrels per day, exceeding the OPEC+ agreed target by 113,000 barrels.

Bloomberg noted that U.S. President Joe Biden’s visit to Saudi Arabia last month, during which he requested increased production, suggests that Middle Eastern countries have so far been cooperative.

This content was produced with the assistance of AI translation services.