OPEC oil output dropped in February, slumping to its lowest in over a decade after supplies from Libya nearly halted due to a blockade of ports and oilfields, according to a Reuters survey.
Additionally, Saudi Arabia and other Gulf members over-delivered on a new production-cut deal.
On average, the 13-member Organization of the Petroleum Exporting Countries pumped 27.84 million barrels per day (bpd) last month, according to Reuters, down 510,000 bpd from January’s figure.
With oil prices slipping to $50 a barrel on concern that the coronavirus outbreak will reduce oil demand, OPEC has proposed deeper output cuts to the existing accord.
OPEC, Russia and other allies, known as OPEC+, agreed last year to deepen a previous supply cut by 500,000 bpd from Jan. 1, 2020. OPEC’s share of the new reduction is about 1.17 million bpd, to be made by 10 members, all except Iran, Libya and Venezuela.
OPEC proposed a cut of additional cut of 1 million bpd, but it has yet to receive support for the proposal from Russia. The countries that are members of the pact will meet this week to discuss further steps to support the market.
Russian energy minister Alexander Novak said the country is considering an initial proposal by OPEC to cut output by 600,000 mbpd but has not received the proposal for the larger cuts.
The 10 OPEC members bound by the agreement easily exceeded the pledged cuts in February thanks to Saudi Arabia and its Gulf allies cutting more than called for to support the market.
Oil output in Libya has plunged since Jan. 18 due to a blockade of ports and fields by groups loyal to eastern-based commander Khalifa Haftar.
Production in Libya averaged 155,000 bpd during the month, the survey found, down from 760,000 bpd in January.
The Reuters survey tracks supply to the market and is based on shipping data provided by external sources, Refinitiv Eikon flows data and information provided by sources at oil companies, OPEC and consultants.