Oil output of members of the Organisation of Petroleum Exporting Countries (OPEC) rose in September to its highest since April 2020, as Nigeria’s production also recovered from involuntary losses.
The group’s top producers further eased supply curbs in September under a pact with its allies known as OPEC+, revealed a survey by Reuters.
According to the survey, OPEC pumped 27.31 million barrels per day (bpd) last September, up 420,000 bpd from August’s revised estimate.
The biggest rise in September was from Nigeria, where output rose by 170,000 bpd after Forcados force majeure and other problems in August were eased.
The Forcados terminal export outlet was under force majeure in August, limiting supply. Even so, Nigeria is pumping almost 100,000 bpd less than its OPEC target as under-investment restrains output.
OPEC and allies, known as OPEC+, are easing output cuts made in April 2020 as demand recovers, although due to a lack of capacity in some members, OPEC+ is not delivering the full boost promised. This had helped support oil prices, which is trading above $80 a barrel, and close to a three-year high.
The OPEC+ agreement allows for a 400,000 bpd production increase in September from all members, of which 253,000 bpd is shared by the 10 OPEC members covered by the deal.
While the 10 OPEC members raised output by more than last month’s figures in September, they are still pumping less than expected under the latest deal, as OPEC compliance with pledged cuts was 114 per cent when compared with 115 per cent in August.
OPEC+ meets on Monday to review its policy and is expected to re-confirm plans for the monthly increases.
The second-largest increase came from top exporter Saudi Arabia, which further raised supply as part of the September OPEC+ boost even as Iraq, Kuwait, the United Arab Emirates and Algeria made smaller increases.
Output declined or did not increase in Angola, Congo, Equatorial Guinea and Gabon, the survey found, owing to a lack of production capacity to add more supply.
Iran, which had managed to raise exports since the fourth quarter despite U.S. sanctions, has posted slightly higher output this month, the survey found.
The country is exempted from OPEC supply curbs due to the sanctions; although a larger export recovery depends on progress in talks to revive its 2015 nuclear deal with world powers. Those talks are currently stalled.
Among the other two producers exempted from curbs, Libyan and Venezuelan output also slightly increased, based on shipping data provided by external sources.
Nigeria’s inability to meet its OPEC production quota has been a source of concern to the country which desperately needs every dollar it can possibly get, as the government continues to ration forex due to increasing scarcity.