The Organization of Petroleum Exporting Countries (OPEC), the 12-country cartel, responsible for about 40% of the world's oil supply, will reduce shipments by the end of this month because demand for gasoline is close to passing its summer driving season peak. The production cut from OPEC is the first in nearly two months.
OPEC will ship 22.81 million barrels a day in the four weeks to July 2, down 0.7 percent from the period to June 4, Bloomberg News reported, citing Oil Movements. That estimate excludes data pertaining to Angola and Ecuador, OPEC's smallest member in terms of output.
When OPEC met in Vienna last week, the cartel failed to reach a consensus on supply matters with Saudi Arabia, the group's top producer, wanting to increase output to keep prices from crimping demand. That idea was met with opposition from OPEC price hawks such as Iran and Venezuela, who prefer prices remain high.
Shipments from Middle Eastern producers, including non-OPEC members Oman and Yemen, will drop 1.2% to 17.56 million barrels a day in the period, according to Oil Movements, Bloomberg reported. Algeria, Iraq, Kuwait, Libya, Nigeria, Qatar, and United Arab Emirates are the other OPEC members not previously mentioned here.