Top oil exporter Saudi Arabia has raised production in May, a Reuters survey found, but not by enough to compensate for lower Iranian exports which collapsed after the U.S. tightened the screw on Tehran.
OPEC pumped 30.17 million barrels per day (bbl/d) in May, down 60,000 bbl/d from April and the lowest total for the 14-member group since 2015, the Reuters survey showed.
The survey suggests that even though Saudi Arabia is raising output following pressure from U.S. President Donald Trump to bring down prices, the kingdom is still voluntarily pumping less than an OPEC-led supply deal in place this year allows it to.
"We are seeing OPEC supply falling in May to its lowest in numerous years," said an industry source who monitors OPEC output. "There are not many big increases this month, and lots of countries posting lower supply."
Despite lower supplies, crude oil has fallen from a six-month high above $75 a barrel in April to below $68 on May 30, pressured by concern about the economic impact of the U.S.-China trade dispute.
An OPEC delegate said most countries had kept a lid on output in May, although they might have sought to boost sales in the faster-growing Asian market.
"Producers may change the portfolio to target Asia but not increase production generally," he said.
OPEC, Russia and other non-members, an alliance known as OPEC+, agreed in December to reduce supply by 1.2 million bbl/d from Jan. 1. OPEC's share of the cut is 800,000 bbl/d, to be delivered by 11 members—all except Iran, Libya and Venezuela.
The producers are scheduled to meet in June to decide whether to extend the deal or adjust it.
In May, the 11 OPEC members bound by the agreement achieved 96% of pledged cuts, the survey found, compared to 132% in April, due to the rise in production in Saudi Arabia, and increases in Iraq and Angola.
But a drop in supply in two of the exempt producers more than offset these gains, the survey found. Iran posted OPEC's biggest supply drop this month of 400,000 bbl/d.
The U.S. reimposed sanctions on Iran in November after pulling out of a 2015 nuclear accord between Tehran and six world powers. Aiming to cut Iran's sales to zero, Washington this month ended sanctions waivers for importers of Iranian oil.
Iran has nonetheless sent abroad about 400,000 bbl/d so far this month, less than half as much as it exported in April.
In Venezuela, supply fell by 50,000 bbl/d in May due to the impact of U.S. sanctions on state oil company PDVSA and a long-term decline in production, according to the survey.
Output also dropped in Nigeria—which last month overproduced its target by the largest margin—because of a pipeline shutdown that disrupted exports.
Among countries pumping more, Saudi Arabia boosted supply by 200,000 bbl/d to 10.05 million bbl/d, the survey found. This is still below its OPEC quota of 10.311 bbl/d.
Iraq boosted exports and Libya, which is volatile due to unrest, enjoyed a period of relative stability.
Even so, May's output is the lowest by OPEC since February 2015, excluding membership changes that have taken place since then, Reuters surveys show.
The Reuters survey aims to track supply to the market and is based on shipping data provided by external sources, Refinitiv Eikon flows data and information provided by sources at oil companies, OPEC and consulting firms.
U.S. oil rigs fell by one to 491 this week, while gas rigs rose four to 113, their highest since January 2020, according to the closely followed Baker Hughes report.
"This award reiterates GATE's position as the global leader in the energy transition,” Karthik Annadorai, executive vice president of GATE Energy, said.
The investment bank said key oil products markets are showing "steep backwardation and inventories that have fallen to low levels."