Brent crude surged to $87.92 per barrel following reports that crude oil output dipped in key OPEC members Nigeria and Iraq.
The rise in Brent’s price comes amidst concerns over supply shortages exacerbated by reduced exports from these oil-producing giants.
According to a recent survey conducted by Reuters, OPEC’s oil output declined in March due to diminished exports from Iraq and Nigeria.
This decline, amounting to 50,000 barrels per day (bpd) compared to February, underscores the impact of production cuts within the OPEC+ alliance.
Iraq, in particular, pledged to lower its exports to compensate for exceeding its OPEC target. This promise translates to a reduction of 130,000 bpd in shipments from February.
However, despite this commitment, March’s output cut fell short, leaving room for further adjustments in the coming months.
Similarly, Nigeria experienced a decline in production, with exports seeing a sharper decrease as the Dangote refinery absorbed more cargoes.
These reductions, coupled with ongoing voluntary supply cuts by other OPEC+ members, have led to a tightening of global oil supply, consequently driving up prices.
The surge in Brent’s price to $87.92 per barrel underscores the delicate balance between supply and demand in the oil market.
While reduced output from Nigeria and Iraq has contributed to this upward trajectory, concerns remain regarding OPEC’s ability to meet its production targets in the face of evolving market dynamics.
As OPEC+ prepares to convene for a crucial meeting to review market conditions and member production, stakeholders anticipate deliberations on potential policy adjustments.
With global oil prices on an upward trajectory, the outcome of these discussions holds significant implications for both producers and consumers worldwide.