The International Energy Agency stated on Tuesday that stalled talks among major oil producers regarding the increase of supply could deteriorate into a price war, as COVID-19 vaccine rollouts trigger a surge in crude demand. The Paris-based agency explained that "the possibility of a market share battle, even if it is distant, threatens the markets, as does the risk of rising fuel prices that could fuel inflation and harm a fragile economic recovery."
In its monthly report, the agency noted that OPEC's crude oil production in June rose by 450,000 barrels per day from May to reach 25.93 million barrels per day, with Saudi Arabia leading the return of oil to the market. Saudi Arabia pumped 8.92 million barrels per day, an increase of 380,000 barrels per day from the previous month, as it continued to ease its voluntary cuts. Riyadh may raise July production by 580,000 barrels per day according to the "OPEC+" agreement while gradually removing its remaining voluntary restrictions.
**Production by key members:**
- Kuwaiti crude availability jumped to 2.38 million barrels per day.
- The UAE's production rose by 40,000 barrels per day to 2.68 million barrels per day, slightly below the top "OPEC+" target.
- Iraq was the only Middle Eastern producer to cut production, pumping 3.9 million barrels per day, a decrease of 40,000 barrels per day from May and 50,000 barrels per day below the "OPEC+" ceiling.
- Supplies from Iran, exempt from quotas, increased by 50,000 barrels per day to 2.45 million barrels per day.
- Among African countries, Nigeria's output fell by 30,000 barrels per day to 1.31 million barrels per day due to operational issues, sabotage, and pipeline leaks that kept production below its quota.
- Angolan supply dropped to 1.08 million barrels per day, which is 220,000 barrels per day short of the targeted volume.
- Libyan production increased to 1.17 million barrels per day.
- OPEC's compliance rate with the quotas stood at 123% during the month.
