OPEC oil output declines in Jan. following Iraq field disruption

Shafaq News/ Oil production by the Organization of the Petroleum Exporting Countries (OPEC) declined in January following a fire at Iraq’s largest oil field, Bloomberg reported.
According to the latest data, OPEC produced just over 27 million barrels per day (bpd) in January, marking a decline of approximately 70,000 bpd compared to the previous month. The decrease in Iraq’s output offset modest production increases in Kuwait and Venezuela.
On January 24, a fire broke out in a storage tank at the Rumaila oil field, temporarily disrupting production by 300,000 bpd—equivalent to 25% of the field’s capacity—for the following week. Despite the incident, Iraq’s total oil production averaged over 4 million bpd last month, aligning with its OPEC quota.
Alongside Iraq’s decline, notable production changes occurred in Kuwait and Venezuela. Kuwait increased its output by approximately 60,000 bpd, reaching 2.49 million bpd, while Venezuela boosted its production by 50,000 bpd, bringing its average to 900,000 bpd.
The OPEC+ alliance plans to begin gradually increasing production by 120,000 bpd starting in April, with a phased restoration of 2.1 million bpd by late 2026. However, the timeline has already been postponed three times due to concerns that additional supply could impact market stability. With one month remaining before the scheduled April decision, uncertainty remains over whether the increase will proceed as planned.
At just over 4 million bpd, Iraq’s output is now closer to its designated OPEC ceiling than at any point since the quota was established last year. However, the country has yet to implement additional cuts to offset previous overproduction—a step that Kazakhstan and Russia have also committed to.
OPEC+ continues to enforce its supply-restriction agreement, which remains in effect until the end of the first quarter of 2025, with gradual monthly increases planned thereafter. The coalition has maintained production cuts since late 2022 in an effort to support oil prices.
During a virtual review meeting on Monday, OPEC+, led by Saudi Arabia and Russia, agreed to uphold the current agreement. The decision comes amid ongoing concerns over weak demand in China, the world’s largest oil consumer, and rising alternative supplies from the Americas.