Libya, Nigeria’s oil crises hinder OPEC’s commitment to production increase

The rise in OPEC oil production in April was less than the increase planned under an agreement with its allies, and declines in Libya and Nigeria offset the impact of increased supplies by Saudi Arabia and other major producers.

The results of a survey conducted by “Reuters” showed that “OPEC” pumped 28.58 million barrels per day in April, an increase of 40,000 barrels per day compared to the previous month, and less than the 254,000 barrels per day stipulated in the supply agreement.

The National Oil Corporation in Libya had previously declared force majeure at the Zueitina oil port last week, warning of a “severe wave of closures” against the backdrop of the political crisis sweeping its facilities.

Reuters indicated that OPEC and its allies, known as “OPEC +”, are gradually reducing the production cuts agreed upon in 2020 as demand recovers from the Corona pandemic.

The agreement provides for an increase in production by 400 thousand barrels per day in April by the members of “OPEC +”, of which about 254 thousand barrels per day are shared by the ten OPEC producers covered by the agreement.

Reuters’ findings revealed that production falls short of the increases pledged from October to March, with the exception of February, when many producers lack the ability to pump more crude due to a lack of investment, a trend exacerbated by the pandemic.

As a result, the ten OPEC members pumped much less than what was stipulated in the agreement. The survey found that OPEC’s compliance with the pledged cuts amounted to 164%, compared to 151% in March.

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