OPEC production climbed to a three-year high in July despite continued oil price volatility and concerns about a global supply glut.
Last month’s production total marked the highest volume OPEC has pumped since August 2012 when the group produced an estimated 31.54 million bpd, Platts noted.
Saudi Arabia, OPEC’s largest producer, accounted for nearly all of the production gains after boosting its own production by 100,000 bpd in July to 10.45 million bpd.
Saudi Arabia has been steadily pumping over 10 million bpd during the first half of the year and has shown no signs of slowing its production down.
Production in Libya fell again in July to 390,000 bpd, down from 410,000 bpd in June, as technical problems and militant attacks continue to plague the country’s energy assets.
Angola managed to boost its production by 50,000 bpd while the United Arab Emirates added another 30,000 bpd of production and Iran booked a 20,000 bpd production bump, Platts said.
Production dips in Algeria, Libya and Nigeria dropped output by a collective 80,000 bpd.
“OPEC is now pumping at its highest level in three years, and that’s before Iran comes back at full throttle, At some point, something will have to give, but that time may be some way off,” Platts senior correspondent Margaret McQuaile said.
OPEC has adamantly defended its production target despite last year’s oil price rout and criticism from some of the group’s smaller members.
The group’s production numbers could climb even higher when oil export sanctions against Iran are lifted.
After months of tense negotiations, six world powers agreed in July to roll back oil sanctions against Iran if the country curbs its nuclear development program.
Under the deal, Iran will be forced to remove two-thirds of its installed centrifuges and store them under international supervision, dispose of 98 percent of its enriched uranium and permanently grant the International Atomic Energy Agency any kind of access it needs to monitor nuclear development.
The sanctions will only be lifted once Iran has complied with the terms of the agreement, and after the deal has been ratified by the U.S. Congress.
Although Iran has said it could boost its supply by 1 million bpd within six months of the sanctions being lifted the International Energy Agency said earlier this week that the country may only be able to add up to 730,000 bpd within months of sanction relief.
Western sanctions have kept Iran’s exports to about 1 million bpd since 2012, down from a high of about 2.5 million bpd.
“Now, with Iran poised to export more oil, the market share spotlight has homed in on OPEC itself. Iran has made clear that boosting exports to the still-growing markets of Asia will be a priority when sanctions are lifted. But competition is already rife in Asia as suppliers from far afield try to find new markets for barrels no longer needed in the United States and with Iraq already exporting its increased southern production eastward,” Platts said.