Saudi Arabia told OPEC that it pumped a record 10.67 million barrels of oil a day in July to meet a summer surge in domestic demand, an increase that will do nothing to endear OPEC’s leading exporter to other members seeking output limits to shore up prices.
The figures were submitted to the Organization of Petroleum Exporting Countries, according to two people with knowledge of the data, asking not to be identified because the information was not made public, Bloomberg reported.
The output beat the previous all-time production high of 10.56 million barrels a day in June 2015, according to OPEC submissions. OPEC’s monthly report was scheduled to be released Wednesday.
"OPEC will hold informal talks at a conference in Algiers next month, as members constantly discuss ways to stabilize the market," Mohammed Al Sada, Qatar’s energy minister and holder of OPEC’s rotating presidency, said on Monday.
Russia, Saudi Arabia and other major oil exporters met in Doha, Qatar, in April in a bid to stabilize markets by putting caps on output. The effort collapsed after Saudi Arabia demanded that rival Iran be a part of the deal. At the time, Iran had ruled out any limits on its output as it ramped up production after the lifting of international sanctions.
“It’s not surprising to see Saudi output at record,” said Anas al-Hajji, an independent analyst and former chief economist at NGP Energy Capital Management LLC in Houston. “The Saudis didn’t want to cut back on exports and they needed to produce more to meet local summer demand. Also, the Saudis are processing more crude this year at refineries, as they want to grow in products market.” Saudi Arabia’s increased crude output comes, as Russia and Iran are boosting shipments to top demand markets such as India and China.
"Any talk about a new oil production freeze pact is very premature and a mere wishful talking up of market sentiment while Russia, Saudi Arabia and Iran keep boosting output," said Mohamed Ramady, London-based independent analyst and former professor of economics at King Fahd University of Petroleum and Minerals.
