OPEC oil output in May increased slightly but fell short of expectations, as Iraq and Gulf states limited production boosts. The Reuters survey revealed a smaller-than-agreed rise in total supply.
OPEC, which includes top oil exporters like Saudi Arabia and the UAE, pumped 26.75 million barrels daily in May. That marked an increase of 150,000 barrels per day compared to April levels.
However, the output increase remained below the 310,000 barrels per day target agreed for five OPEC members. These members included Algeria, Iraq, Kuwait, Saudi Arabia, and the UAE.
Iraq reduced output significantly in May, complying with its pledge to make compensation cuts for earlier overproduction. These cuts helped reduce the overall increase among the five nations.
Saudi Arabia made the largest production hike, adding 130,000 barrels per day. Still, it fell short of its maximum allowed increase under the latest OPEC+ agreement.
Meanwhile, the United Arab Emirates also produced less than its quota. According to industry sources, the UAE faced lower compensation requirements, which influenced its production strategy.
Some international energy analysts believe actual output might be higher than reported. Estimates from the International Energy Agency suggest Iraq and the UAE are pumping more than official figures indicate.
Even so, the Reuters survey is based on real market flows. Data from LSEG and firms like Kpler supports these findings, alongside input from oil companies and OPEC insiders.
This difference in data has long posed a challenge for oil market transparency. OPEC’s secondary sources and independent observers often report conflicting numbers regarding real-time supply levels.
Nevertheless, the slow and limited output increase in May reflects the group’s cautious strategy. OPEC+ continues balancing its production plan against market needs and member compliance.
While global demand remains unpredictable, OPEC+ seeks to manage prices without oversupplying the market. Analysts are watching closely for signs of further adjustments next month.
In conclusion, OPEC oil output in May rose less than planned due to lower hikes by Iraq and Gulf countries. This trend may influence upcoming policy decisions.
