Oil production among OPEC members fell sharply in April, reaching the lowest level in over twenty years, according to a recent Reuters survey. The decline was driven primarily by disruptions caused by the ongoing conflict involving Iran, which led to an effective closure of the Strait of Hormuz, a crucial passage for oil exports. This development forced several member countries to cut their output significantly.
In April, OPEC’s total crude oil production decreased by 830,000 barrels per day compared to March, settling at 20.04 million barrels per day. This figure was further revised downward from previous estimates due to updated data from Saudi Arabia. The drop in production contrasts with earlier plans by eight OPEC+ producers who had agreed to increase output that month before the outbreak of the Iran war on February 28.
Kuwait experienced the most significant reduction in oil output within the group, suffering from a full month of export disruptions. Saudi Arabia and Iraq also recorded declines in production during April. In contrast, the United Arab Emirates managed to increase its output as it benefits from an export route that bypasses the Strait of Hormuz. Data from tanker tracking companies showed that UAE exports rose despite regional tensions.
Besides the Gulf members, Venezuela and Libya were among the few OPEC countries that raised their production levels in April. Notably, the UAE officially left OPEC on May 1 but remained active during April. The overall output level reported is significantly lower than even during the global demand slump caused by the COVID-19 pandemic in 2020.
The Reuters survey compiled these findings using flow data from multiple sources including financial group LSEG and energy tracking firms such as Kpler, along with insights from oil companies and consultants. The report underscores how geopolitical conflicts can severely impact global oil supply chains and complicate efforts to stabilize markets.
This drop in production raises concerns about potential supply shortages and price volatility as tensions persist in a key oil transit region. Market analysts will closely watch upcoming OPEC reports for signs of recovery or further disruptions. For now, the data highlights how fragile oil supplies remain amid ongoing geopolitical uncertainties.
