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OPEC’s largest producer and de facto leader, Saudi Arabia, told the cartel that its December crude oil production dropped by nearly 300,000 bpd from November to 9.594 million bpd, a much steeper decline than OPEC’s secondary-sources estimate of an 111,000-bpd fall, the organization’s Monthly Oil Market Report (MOMR) showed on Wednesday.
Over the past few months, after the mid-September attacks on Saudi oil infrastructure, OPEC’s biggest producer has directly reported to OPEC significantly different production numbers than OPEC’s secondary source figures.
In the aftermath of the attacks on its oil, Saudi Arabia was busy reassuring the oil market and its customers that it can and will quickly ramp up production to pre-attack levels and will leave no customer wanting for Saudi crude.
For October, for example, Saudi Arabia’s direct communication to OPEC showed production at 10.303 million bpd, while OPEC’s secondary sources pinned the Saudi production at 10.0 million bpd.
Later on, Saudi Arabia reported to OPEC that its November production had dropped by 412,000 bpd to 9.89 million bpd. The secondary sources estimated nearly the same production for November—9.85 million bpd, but this was 151,000 bpd lower than the October production as per the secondary sources.
For December, OPEC’s secondary sources found that Saudi Arabia’s oil production was 9.762 million bpd, down by 111,000 bpd from November. The Saudis themselves reported production of 9.594 million bpd—this is a 168,000 bpd gap between the Saudi claim of production and the number from the secondary sources.
Regardless of the source of reporting of production, Saudi Arabia was still the OPEC producer that cut its oil production in December the most, signaling that as OPEC’s de facto leader, it is eager to show that it will continue to overcomply, by a mile, with its share of the cuts.
As per secondary sources, Saudi Arabia’s December cut of 111,000 bpd, as well as production reductions in Iraq and the UAE and an outage in Libya, more than offset Angola’s 125,000-bpd production increase as the Girassol grade returned from maintenance.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.