The Organization of Petroleum Exporting Countries (OPEC) produced an average of 31.8 million barrels/day of crude in May, the cartel’s highest level of production since September of 2008 and about 2 million barrels/day above official quotas. Production in April reached 31.75 million barrels/day. These production totals are based on a Reuters survey of OPEC officials and market analysts.
Saudi Arabian production rose to 10.1 million barrels/day, it’s highest level in decades according to Reuters. The Saudis have continued to raise production as the price of crude falls because the government believes that crude prices above about $100/barrel are too high. The Saudis produced an average of 9.1 million barrels/day in 2011 according to the annual review published by state-owned Saudi Aramco.
Iran supplied just 3.13 million barrels/day in May, its lowest total since 1990. The country’s onshore storage tanks are already bursting and much of Iran’s production is going into floating storage. The situation is likely to get worse unless talks next month between Iran and the ‘P5+1’ can agree on steps to curtail Iran’s nuclear program and ease the stiffer sanctions that are set to take effect on July 1st.