OPEC July oil output surges as Gulf voluntary cuts end

An easing of lockdowns and lower supply have helped oil prices to climb above $40 from April’s 21-year low of below $16 a barrel. (Reuters)
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Updated 01 August 2020

OPEC July oil output surges as Gulf voluntary cuts end

  • Lockdown easing and lower supply have helped rise, although second wave concerns keep lid on gains

LONDON: OPEC oil output has risen by more than 1 million barrels per day (bpd) in July as Saudi Arabia and other Gulf members ended their voluntary extra supply curbs on top of an OPEC-led deal, and other members made limited progress on compliance.
The 13-member Organization of the Petroleum Exporting Countries pumped 23.32 million bpd on average in June, the survey found, up 970,000 bpd from June’s revised figure, which was the lowest since 1991.
OPEC and allies agreed in April to a record output cut as the coronavirus crisis hammered demand.
An easing of lockdowns and lower supply have helped oil to climb above $40 from April’s 21-year low of below $16 a barrel, although concerns of a second wave are keeping a lid on gains.
“Upside potential will continue to be in short supply so long as the COVID hangover lingers,” said Stephen Brennock of oil broker PVM.
OPEC, Russia and other producers, a group known as OPEC+, agreed to cuts of 9.7 million bpd, or 10 percent of global output, from May 1.
OPEC’s share, to be made by 10 members from October 2018 levels in the case of most countries, is 6.084 million bpd.
In July, they delivered 5.743 million bpd of the pledged reduction, equal to 94 percent compliance, the survey found. Compliance in June was revised up to 111 percent.
July’s increase is the biggest since April, when OPEC briefly pumped at will before the latest supply cut was agreed.

HIGHLIGHTS

• Record OPEC+ oil supply cut took effect on May 1.

• Saudi Arabia boosts supply close to quota levels.

• Easing lockdowns help oil climb above $40.

To further support the market, Saudi Arabia, Kuwait and the UAE had pledged to cut by an extra 1.18 million bpd in June only.
This helped to curb output last month to OPEC’s lowest since 1991, excluding membership changes, based on Reuters surveys and OPEC figures.
The biggest rise in supply in July came from Saudi Arabia, which pumped 8.4 million bpd, up 850,000 bpd from June and close to its quota, the survey found.
The UAE and Kuwait also boosted output close to their targets. Iraq and Nigeria, which boosted compliance in June and were laggards in previous OPEC+ deals, did not make any further cuts in July, the survey found, with Iraq boosting exports. Both have pledged to make additional reductions in
later months. “The low prices are making life difficult for those OPEC countries that are required to cut their production additionally,” said Eugen Weinberg, analyst at Commerzbank.
Iranian and Libyan supply held steady in July and Venezuelan output dropped further. All three are exempt from voluntary cuts because of US sanctions or internal issues limiting output. Libyan output has plunged since January due to a blockade of ports and fields by groups loyal to eastern-based commander Khalifa Haftar.
The Reuters survey aims to track supply to the market and is based on shipping data provided by external sources, Refinitiv Eikon flows data, information from tanker-trackers such as Petro-Logistics and Kpler, and information provided by sources at oil companies, OPEC and consultants.


Emirates launches airbridge between Dubai, Lebanon emergency relief 

Updated 14 August 2020

Emirates launches airbridge between Dubai, Lebanon emergency relief 

  • Customers of Emirates will be able to donate cash or pledge their Skywards Miles to the airline for the aid
  • Emirates SkyCargo will also provide 20 percent reduction on air freight transportation charges for approved shipments

DUBAI: UAE national carrier Emirates SkyCargo plans to ramp up its freighter operations to Lebanon with 50 flights to deliver emergency relief in the wake of the Beirut port blast that killed nearly 200 people.
Customers of Emirates will be able to donate cash or pledge their Skywards Miles to the airline for the aid, state news agency WAM reported.
The Emirates Airline Foundation will coordinate shipments of urgent food, medical supplies with NGO partners to ensure donations directly help those affected on the ground.
Emirates SkyCargo will also provide 20 percent reduction on air freight transportation charges for approved shipments, underscoring its commitment to expedite emergency relief efforts to Beirut.
“Today, the world is banding together to stand in solidarity with Lebanon, providing urgent relief and immediate recovery support to those affected by this tragic disaster,” Chairman and Chief Executive of Emirates Airline & Group, Sheikh Ahmed bin Saeed Al-Maktoum, said. 
“Emirates supports the UAE’s ongoing humanitarian efforts to support Lebanon and is committed to bolster its global emergency response to ensure that it can support organizations which provide urgent care, shelter, food and medical support to the Lebanese people,” he added. 
Emirates said that it had dispatched several charter flights carrying food, clothing and medical supplies donated by various grassroots organizations in the UAE to Lebanon.