OPEC output disrupted in July on Nigeria attacks, Libya dispute

NEW YORK (Bloomberg) -- OPEC’s crude oil output was disrupted in July by militant attacks in Nigeria and political disputes in Libya, according to a Bloomberg News survey.

 

Output from the 13 established members of the Organization of Petroleum Exporting Countries, excluding new entrant Gabon, fell by 80,000 bpd last month, a Bloomberg survey of analysts, oil companies and ship-tracking data showed. Nigeria led the decline with a 70,000-bpd monthly drop to 1.52 MMbpd, while Libya and Saudi Arabia reduced output by 20,000 and 40,000 bpd, respectively.

 

Gabon joined OPEC on July 1, becoming the smallest member with average output of 210,000 bpd. Because the group expanded to 14 nations, total production in July actually increased to 33.24 MMbpd from 33.11 MMbpd the prior month. The African nation initially joined the group in 1975, but ended its membership 20 years later.

 

Nigeria has suffered steep crude output losses this year as militant attacks targeted oil infrastructure. Production in May fell to the lowest level in more than 27 years. While output recovered in June, it fell again in July following the disruption of supplies to the Qua Iboe terminal, which shipped an average of 342,000 bpd last year.

 

Bear Market

 

Libya’s production fell by 20,000 bpd to 300,000 in July. The Arabian Gulf Oil Co. halted output at Sarir field last month after a protest by oil-facility guards shut the Eastern port of Hariga, blocking exports. The Tripoli-based Government of National Accord reached a deal with guards last week to reopen Es Sider and Ras Lanuf, two of its biggest oil terminals that have been closed since 2014, although shipments have yet to resume.

 

Output disruptions helped raise West Texas Intermediate crude as high as $51.67/bbl on June 9. The benchmark has since fallen back into a bear market amid signs that the decline in U.S. output is stabilizing and concerns about the strength of demand.

 

Iranian production gains continued, rising by 20,000 bopd to 3.55 MMbopd in July. Sanctions on the country’s oil industry were lifted in January following an accord on its nuclear program, driving an almost 25% rise in its production.

 

Bloomberg News has expanded the sources used in its monthly production survey. They now include oil companies, governments, OPEC, analysts and tanker tracking. Some estimates for June were revised to reflect additional information.