A survey indicates that OPEC crude oil production continued to recover last month, regaining some of the losses suffered during the war. Increased output from Kuwait, Saudi Arabia, and Iraq was the primary driver, though opaque shipping data complicates efforts to track the group's production.
The survey shows OPEC's crude output in July rose by 1.16 million barrels per day (bpd) to an average of 19.44 million bpd. Nearly all of this increase came from the three Gulf states. However, with the Iran war persistently disrupting shipping in the Persian Gulf and the Red Sea route still facing risks, overall OPEC production remains significantly below pre-war levels.
Part of the July production growth may also be attributed to higher domestic consumption. Middle Eastern oil producers typically increase output during the summer to meet surging demand for electricity from air conditioning, with some crude directly used for power generation.
The survey reveals that Iraq was the largest contributor to OPEC's July increase, boosting daily output by 460,000 bpd to 2.3 million bpd. Kuwait's production rose by 360,000 bpd to an average of 1.57 million bpd per month. The situation for OPEC's de facto leader, Saudi Arabia, is more complex. The survey shows Saudi Arabia increased its July daily output by 390,000 bpd to 7.4 million bpd, which is still millions of barrels per day below pre-war levels. Meanwhile, Saudi Arabia's crude oil exports are under pressure as Iran-backed Houthi rebels in Yemen threaten tankers using the Red Sea shipping route.
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