Libya's restart of oil production at largest field lifts OPEC output
TLDR
- OPEC's oil production increased with Libya restarting Sharara field, reaching 26.68 MMbpd, despite Iraq slightly reducing supplies.
- Saudi Arabia leads OPEC's production cuts to prevent a global surplus and support prices, with oil hovering near $80 a barrel.
- Delegates foresee production curbs continuing into the second quarter amid concerns over global oil demand growth and rising Americas output.
OPEC's oil production increased last month, largely due to Libya restarting its largest field, Sharara, after protests caused its closure earlier in the year. According to a Bloomberg survey, OPEC's production rose by 110,000 barrels per day (bpd) to reach 26.68 million barrels per day (MMbpd).
While Iraq slightly reduced supplies, it and the United Arab Emirates continued to exceed the new quota set at the beginning of the year. Led by Saudi Arabia, OPEC and its allies implemented new production cuts this quarter to prevent a global surplus and support prices.
Oil has hovered near $80 a barrel, partly due to concerns over soaring output from the Americas and potential slowdowns in global oil demand growth. Several delegates predict that OPEC+ will extend the production curbs into the second quarter.
Key Takeaways
Libya’s production increased by 120,000 bpd to 1.14 MMbpd in February, according to the survey. Iraq reduced by 40,000 a day to 4.16 MMbpd, while the UAE was steady at 3.14 MMbpd. The shutdown of Sharara had led to a drop in Libya’s oil production to below 1 million barrels per day, marking the first time in months that production fell to this level. The oil field is managed through a joint venture involving the National Oil Corp., Repsol SA of Spain, TotalEnergies SE of France, OMV AG of Austria, and Equinor ASA of Norway. The closure was initiated by protesters advocating for social and economic reforms, including improved job opportunities, better services, and the establishment of a new refinery.
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