On Tuesday, Bloomberg reported that in July OPEC’s oil production fell by the most in three years, due to Saudi Arabia’s additional voluntary cuts to production to support crude oil prices.
The analysis by the outlet showed that in July, the total output by OPEC fell 900,000 barrels per day (bpd), to an average of 27.79 million bpd. It marked the largest fall in production since 2020, when production by the cartel was slashed as demand collapsed due to the pandemic lockdowns.
According to the survey, Saudi Arabia made good overall on its promise to voluntarily cut production by up to one million barrels per day, reducing output in July to 9.15 million bpd as lackluster economic data from China and recession fears in the United States weighed on prices. In addition, production from Nigeria and Libya also fell, dropping 130,000 bpd and 50,000 bpd, respectively, according to the data.
Saudi Arabia has since announced it will extend its production cuts through September, and shortly thereafter Russia announced it would also cut exports by 300,000 bpd through September.
Tanker tracking data cited in a report by Bloomberg indicated that Russia, the top crude producer among OPEC’s allied nations, has seen its production decline to a seven-month low, settling at just below 3 million bpd.
Riyadh had announced last month it would be extending its voluntary crude output reduction of 1 million bpd for another month, to include August. Russia, meanwhile, announced simultaneously that it would cut production by 500,000 bpd for August. The cuts will add up to roughly 1.5% of the total supply globally.
Russia and Saudi Arabia will join together to oversee a review online of market conditions on August 4th, with the full OPEC+ alliance holding a meeting of its 23 member nations in late November.
Oil prices have been recovering as supplies globally have tightened, reaching over $85 per barrel, for a three-month high. Brent Crude futures were trading at $85.11 as of Friday, while US West Texas Intermediate (WTI) futures were trading at over $82 per barrel.
