Saudi Arabia's oil production at lowest level since 1990

Saudi Arabia informed OPEC that its oil production declined last month to its lowest level since 1990, amid renewed hostilities between the United States and Iran, which have pressured Saudi and broader Gulf oil export routes.

According to an OPEC monthly report obtained by Bloomberg, Riyadh informed the organization’s secretariat that its production fell by approximately 1.9 million barrels per day to 6.238 million barrels per day last month.

Bloomberg noted that this level is lower than Saudi Arabia’s lowest oil production during the US-Iran war, which occurred in April, and represents the lowest figure announced by the kingdom since the conflict began on February 28.

As production declined in many oil-producing countries, particularly in the Gulf region, prices of the global benchmark Brent crude oil rose above $100 per barrel this week amid renewed attacks on oil tankers in the Gulf. Meanwhile, soaring fuel prices are stoking inflation in the United States and squeezing consumers.

Saudi Arabia’s announcement of a general drop in production coincided with preliminary oil tanker tracking data compiled by Bloomberg, which indicated that Saudi crude oil exports fell by about a third in August to approximately 3 million barrels per day.

Saudi Arabia reported to OPEC that “crude oil supplies to the market”—a figure that includes oil movements from storage facilities—were higher than production in August, reaching 7.122 million barrels per day, suggesting that the kingdom may have drawn down some of its stockpiles.

In addition to data reported directly by member countries, the OPEC monthly report also includes an assessment from several external companies known as “secondary sources.” This average showed that Saudi production in August was only slightly lower than in the previous month, standing at 7.276 million barrels per day.