OPEC+ Missed Output Targets By 2.9 Million Barrels Per Day In July.

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OPEC+ produced 2.892 million barrels per day (bpd) below their targets in July, two sources from the producer group said; as sanctions on some members and low investment by others stymied its ability to raise output.

Compliance with the production targets stood at 546% in July the sources said, compared with 320% in June, when the supply gap stood at 2.84 million bpd.

OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies led by Russia; agreed to increase output by 648,000 bpd in each of July and August, as they fully unwind nearly 10 million bpd of cuts implemented in May 2020 to counter the COVID-19 pandemic.

The group agreed this month to increase production targets by another 100,000 bpd in September; under pressure from major consumers including the United States which are keen to cool prices. 

Only Saudi Arabia and the United Arab Emirates are believed to have some spare capacity and will be able to increase production in a meaningful way.

Global oil production spare capacity, mainly concentrated in the two Gulf producers, is already at historical lows.

Reuters.

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