<mediadc-video-embed data-state="{"cms.site.owner":{"_ref":"00000161-3486-d333-a9e9-76c6fbf30000","_type":"00000161-3461-dd66-ab67-fd6b93390000"},"cms.content.publishDate":1655238662514,"cms.content.publishUser":{"_ref":"0000016c-7763-d473-a96f-77eb53420000","_type":"00000161-3461-dd66-ab67-fd6b933a0007"},"cms.content.updateDate":1655238662514,"cms.content.updateUser":{"_ref":"0000016c-7763-d473-a96f-77eb53420000","_type":"00000161-3461-dd66-ab67-fd6b933a0007"},"rawHtml":"
var _bp = _bp||[]; _bp.push({ "div": "Brid_54813655", "obj": {"id":"27789","width":"16","height":"9","video":"1029388"} }); ","_id":"00000181-63e9-dd13-a9fb-7bef09e60000","_type":"2f5a8339-a89a-3738-9cd2-3ddf0c8da574"}”>Video EmbedOPEC is struggling to meet modest oil output targets, presenting a problem for President Joe Biden, who is expected to focus heavily on production during a Middle East trip as he faces soaring gasoline prices.
Output among OPEC member countries dropped last month to roughly 28.5 million barrels a day, according to newly published data from the cartel, a 176,000 bpd decline from April.
The group attributed the May numbers to closures of major refineries, including in Libya, which reported a nationwide decrease of 186,000 bpd.
Nigeria saw the second-largest decrease, of 45,000 bpd, followed by Iraq, which saw a reduction of 21,000 bpd.
In the report, OPEC also cited declines in production from Equatorial Guinea, Gabon, Iran, and Venezuela.
Several OPEC members increased production month over month, including Algeria, Congo, Saudi Arabia, and the United Arab Emirates, but it was not enough to drive up overall cartel production. The Saudis and the UAE had the largest increases, OPEC said, and raised production by a combined average of 91,000 bpd.
“Looking ahead, current geopolitical developments and the uncertain roll-out of the pandemic toward the end of the second half of the year continue to pose a considerable risk to the forecast recovery to pre-pandemic levels,” OPEC said in the report.
“Inflationary pressures are likely to persist and it remains highly uncertain as to when geopolitical issues may be resolved. Nevertheless, oil demand is forecast at healthy levels in the second half of this year,” it said.
Still, oil prices spiked in wake of the May report, with futures for international benchmark Brent Crude rising as high as $124.65 a barrel, the highest point in three months.
The new OPEC numbers come less than two weeks after OPEC+ agreed to a modest increase in production for July and August, roughly 648,000 bpd, a rate that looks out of reach at the cartel’s current performance levels.
And in April, the cartel “effectively failed to increase output at all,” Bloomberg reported. OPEC added just 10,000 bpd in April, compared to a scheduled 274,000 a day. Capacity constraints plagued many countries, and even Saudi Arabia failed to meet its agreed increment, producing just 70,000 bpd, or 100,000 below its target.
Ministers from the Group of Seven countries called on OPEC late last month to increase supply, saying the cartel has a “key role” to play in increasing production amid a global energy crisis.
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“We call on oil and gas producing countries to act in a responsible manner and to respond to tightening international markets, noting that OPEC has a key role to play,” members said in a communique.
