In the first half of May, OPEC+ has cut its oil exports sharply, suggesting a strong start in complying with a new production cut agreement.
To offset a decline in oil prices and demand caused by the Covid-19 outbreak, OPEC+ is cutting supply from May 1 by a record 9.7 million bpd. OPEC+ seaborne oil exports over the past month have plunged by 6.3 million bpd towards 27 million bpd.
Compared to April averages - a “massive” decline, the producers’ cut exports for the first 13 days of May estimated by 5.96 million bpd. Saudi Arabia contributes the largest cutback. Down 2.24 million bpd month on month, Saudi oil exports have averaged 7.26 million bpd. A large reduction of 922,000 bpd made by Russia in May.
Shipments were also reduced significantly by Kuwait and the UAE. Down 1.26 million bpd month on month, a combined 4.25 million bpd has been loaded by Kuwait and the UAE onto ships for export. Meanwhile, exports have been cut by 265,000 bpd by Iraq. To deliver Iraq’s pledged cut of 1.06 million bpd in full, this suggests the country needs to do more.
