OPEC oil output rose in July to its highest since April 2020, a Reuters survey found, as the group further eased production curbs under a pact with its allies and top exporter Saudi Arabia phased out a voluntary supply cut.
The Organization of the Petroleum Exporting Countries has pumped 26.72 million barrels per day (bpd), the survey found, up 610,000 bpd from June’s revised estimate. Output has risen every month since June 2020 apart from in February.
OPEC and allies, known as OPEC+, have been unwinding record output cuts agreed in April 2020, as demand and the economy recover. With oil prices rising to a 2 1/2-year high, OPEC+ decided this month on further hikes from August.
“Most forecasts are still predicting robust growth in demand in the second half of the year,” said Carsten Fritsch of Commerzbank. “It is easy to believe that the oil market has learnt to live with the virus, in other words.”
The OPEC+ agreement allows for a 360,000 bpd increase in OPEC output in July versus June, while Saudi Arabia had pledged to add 400,000 bpd as the final step in a plan to unwind a 1 million bpd voluntary cut it made in February, March and April.