The biggest decline from OPEC in June was in Libya, where supply dropped as unrest continued to curb the country’s output. The second-largest decline of 80,000 bbl/d came from Nigeria.
Russian LNG production from projects such as Sakhalin-2 was likely to suffer as a results, said Saul Kavonic, head of Integrated Energy and Resources Research at Credit Suisse. “This will tighten the LNG market materially this decade,” he added.
“OPEC+ is mulling firing its last crude production bullets as it runs out of capacity to pump more, whilst refining capacity for oil products ... which drives the real economy, has declined markedly,” said Ehsan Khoman from MUFG bank.
“Spare capacity is running very, very low,” Shell CEO Ben van Beurden said on June 29, adding that despite economic and COVID-19 challenges, global oil and gas demand is still recovering.
The project by Black Sea Oil & Gas (BSOG), controlled by U.S. private equity firm Carlyle Group LP, is Romania’s first offshore Black Sea development in three decades.
OPEC raised oil output in 2021 but saw the number of active oil wells increase only slightly and the number of new completed wells decline, a factor in surging oil prices in 2022.
“The big unknown is Vladimir Putin’s reaction,” said Tamas Varga from oil broker PVM. If Putin decides to reduce oil or gas exports the plan will backfire and lead to a rise in prices: “It is a nightmare scenario—both for Europe and Russia.”
Saudi Arabia and the UAE have been perceived as the only two countries in OPEC with spare capacity to boost global deliveries that could reduce prices.
Petrobras has experienced an almost constant churn at the CEO position since 2021 stemming from disagreements with Brazil’s President Jair Bolsonaro regarding prices for gasoline and diesel fuel.
Iraq’s state news agency earlier reported that Schlumberger had decided to exit Iraqi Kurdistan but later corrected its story, dropping all mention of plans to exit, without elaborating.