(Bloomberg) -- Key OPEC+ nations Iraq, Kazakhstan and Russia continue to pump above output limits intended to shore up global oil prices, the group’s data showed.
While Russia made a noticeable cutback in June, the three countries are still collectively supplying several hundred thousand barrels a day above quotas set at the start of the year, according to a monthly report from the Organization of Petroleum Exporting Countries.
Supply curbs by the OPEC+ cartel — spearheaded by group leader Saudi Arabia — have helped balance crude markets against a flood of new barrels from the US and other parts of the Americas this year. Brent futures are trading near $84 a barrel in London.
That might still be a little too low for OPEC+ members including the Saudis, who need prices closer to $100 a barrel in order to cover lavish government spending, the International Monetary Fund estimates. The failings of Riyadh’s counterparts in the group poses a further headwind for crude, which has dropped more than $2 this week.
The data published by OPEC’s Vienna-based secretariat on Wednesday show that three of the coalition’s biggest members still haven’t conformed to their targets, let alone begun additional compensatory cuts they promised to make up for earlier cheating.
Russia, which jointly leads OPEC+ with the Saudis, curbed output by 114,000 barrels a day to 9.139 million a day last month, according to the report. That’s still 161,000 above its designated quota. President Vladimir Putin is seeking revenue to continue waging war against Ukraine.
Iraq also made slight reduction, by 25,000 barrels a day to 4.189 million a day, but it remained 189,000 a day above its limit. Baghdad has often chafed against OPEC+ constraints while it seeks revenue to rebuild a war-shattered economy.
Last month, OPEC+ outlined plans to start gradually restoring halted supplies from the fourth quarter, only to stress that the plans are provisional after prices swooned. The group will hold a monitoring meeting on Aug. 1.
©2024 Bloomberg L.P.