After the collapse of the previous OPEC+ deal in early March, OPEC opened the taps in April, pumping at its highest level in 13 months.
Top producer Saudi Arabia and close ally the United Arab Emirates (UAE) saw their output jump to records in April, more than offsetting declines in Iran, Libya, and Venezuela, the monthly Reuters survey showed on Thursday.
The survey, which tracks OPEC’s oil supply to the market and is based on sources at oil firms, OPEC, and shipping data, found that OPEC pumped a total of 30.25 million bpd of oil in April—the highest level since March 2019 and a rise of 1.61 million bpd compared to March 2020.
Saudi Arabia was the major contributor to the higher OPEC supply as it produced a record volume of 11.3 million bpd in April, according to the Reuters survey.
Oil production in the UAE, OPEC’s third-largest oil producer after Saudi Arabia and Iraq, hit a record 3.85 million bpd, according to sources in the survey. Iraq’s production declined because of lower exports, while Kuwait—the fourth-largest oil producer in OPEC—also boosted output, the Reuters survey found.
As of May 1, OPEC is preparing to cut production as part of the new OPEC+ deal to take a total of 9.7 million bpd off the market in May and June.
Saudi Arabia is said to have already started cutting its oil production ahead of the official start of the new OPEC+ pact on Friday, while Kuwait said last week it had already started to reduce crude oil supply to international markets, “sensing a responsibility responding to market conditions.”
Still, before the cuts begin in May, crude oil supply from OPEC soared by more than 2 million bpd in April to the highest levels since December 2018, oil-flow tracking company Petro-Logistics said earlier this week.
As the new deal enters into force on Friday, the market will be closely following reports about production and supply from OPEC and its allies in an attempt to gauge if and how the new cuts could alleviate the global glut amid collapsing demand.
By Tsvetana Paraskova for Oilprice.com
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