Saudi Arabia drives 600,000 b/d increase in OPEC+ June crude output

A second successive jump in Saudi crude production pushed OPEC+ crude output up by a massive 600,000 b/d month over month in June, at a time when the Israel-Iran conflict threatened the security of global oil supply.

OPEC+ production totaled 41.79 million b/ in June -- the second month of accelerated quota increases for a group of eight producers that have been implementing voluntary cuts -- the Platts OPEC+ Survey from S&P Global Commodity Insights showed July 11.

It was the highest total production recorded by the alliance since December 2023, when Angola was still a member.

OPEC increased output by 470,000 b/d to 27.49 million b/d, and its non-OPEC allies added 130,000 b/d to 14.30 million b/d compared to May levels, the survey found.

Saudi Arabia, the world's largest crude exporter and de facto OPEC leader, contributed the biggest increase, adding 400,000 b/d in a month when war in the Middle East raised concerns about shipping disruptions in the Strait of Hormuz – a key conduit for supply from the region to global markets.

While that took the kingdom's production to a two-year high of 9.54 million b/d, survey sources said that its supply to market -- exports, refinery runs and direct use -- was far lower, with much of the additional crude going into domestic and international storage, as well as being used to prepare alternative pipeline routes.

In a statement on July 11, the Saudi Energy Ministry said the kingdom supplied just 9.35 million b/d of crude to the market in June, in line with its OPEC quota. 

On the non-OPEC side, Kazakhstan saw the biggest increase, raising output by 70,000 b/d month over month to 1.83 million b/d.

Both countries are part of the group of eight producers that are implementing 2.2 million b/d of voluntary crude production cuts, which also includes Russia, Iraq, Algeria, the UAE, Kuwait and Oman.

Other countries including Iraq, Kuwait, the UAE and Nigeria also brought barrels back to market in June. Overall, OPEC+ countries with quotas produced 220,000 b/d above their new quotas in June.

The voluntary cutters are hiking quotas through the summer. Most recently, they agreed to increase their quotas by 548,000 b/d in August. OPEC cited a "steady global economic outlook [and] healthy market fundamentals" for the move.

However, oil prices have remained in the low-70s, and some voluntary cutters — including regular overproducer Iraq — have yet to increase production significantly in line with quota hikes.

Analysts continue to predict a price-slashing supply glut in late 2025, once the 2.2 million b/d of cuts are phased out.

Platts assessed Dated Brent at $70.59/b on July 10.

The group will meet again on Aug. 3 to consider September output levels. They can pause, reverse or step up future quota hikes, as conditions warrant.

The Platts survey measures wellhead production and is compiled using information from oil industry officials, traders and analysts, as well as by reviewing proprietary shipping, satellite and inventory data.