Oil prices may be heading…
Rosneft claims to have discovered…
It looks like Libya is right on track to reach its goal to raise crude output to 1 million bpd by the end of July, in what would be a boon for its crippled oil production and a headache for fellow OPEC members that are desperately trying to draw down the glut with production cuts.
Oil production in Libya—which is exempt from OPEC’s production cut quotas—is currently at a four-year high, ranging between 950,000 bpd and “close to” 1 million bpd, up from some 935,000 bpd earlier this week, Reuters reported on Thursday, quoting a Libyan oil source with direct knowledge of the matter.
The fluctuation in the current output is mostly the result of technical and power generation issues. Output is expected to stabilize at the higher end of the 950,000 bpd-1 million bpd range “very soon”, according to Reuters’ source.
Earlier this month, Libya’s National Oil Corporation (NOC) said that it was targeting to reach 1 million bpd of production by the end of July.
NOC has reached an interim deal with Germany’s Wintershall to immediately resume production in concession areas and related fields, which would unblock 160,000 bpd worth of production that has been shut-in for most of the past two years over a dispute between the companies.
“Total oil production in Libya as of today is 830,000 b/d, and we are targeting one million barrels by end of July 2017 as a result of the resumption of production from the Wintershall and linked Abouatiffel fields, as well as from 103 A and Nafoora,” NOC chairman Mustafa Sanalla said in the company statement on June 13.
Libya’s oil output has not exceeded the 1-million-bpd mark since July 2013 due to civil unrest, political divides, and oil export terminals blockades.
Last month, Libya’s average daily production was 730,000 bpd, as per OPEC secondary sources, up by 178,200 bpd compared to April.
Rising supply from Libya—and from Nigeria, which is also exempt from the cuts—coupled with growing U.S. shale output has investors worried that the OPEC cuts are not the “whatever it takes” that it will take to draw down the glut.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.