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The Organization of Petroleum Exporting Countries may have extended a cut in oil production, but the June data show an increase in production compared to May.

In OPEC's July monthly oil-market report (a PDF), the organization projected a 2% rise in non-OPEC oil supplies in 2018, with the lion's share from the United States, followed by Brazil, Canada and Russia. It sees supplies declining in Mexico and China.

In June, according to OPEC's information from secondary sources, production rose the most in Libya and Nigeria, which are exempt from production cuts. But Angola and Saudi Arabia production was notably higher, as was production in Iraq and Iran. (See table for numbers.) The big exception: Venezuela, where oil production in June fell 13,600 barrels per day to 1.938 million barrels per day. Venezuela's production is higher than that in Nigeria, as has been the case historically. OPEC production overall averaged 32.61 million barrels per day in June, an increase of 393,000 barrels per day over the previous month.

According to secondary sources, July oil production in the 14 main OPEC members averaged 32.6 million barrels per day in June, an increase of 393,000 barrels per day over June. The notable exception was Venezuela, where production fell. OPEC

Venezuela's direct communication with OPEC indicated a production decline of 33,000 barrels per day. Russ Dallen, an attorney, publisher and "asset manager's agent" for Caracas Capital Markets writes:

" ... Venezuela's rig count had fallen to 49 in July 2016. Venezuela did try and get more rigs drilling over the last year, hitting a high of 56 in April, but guess what: the rig count for Venezuela is for June 2017: back at 49.

Based on its own estimates that its production was collapsing -- estimates similar to ours --Venezuela agreed with OPEC to cut production to 1.972 barrels per day (in other words giving what was already a fait accompli). Venezuela has fallen through that cut and is now 34,000 barrels per day below its quota -- while as OPEC notes, everyone else's production is going higher. Worse, if you look at the 2015 column on the chart above, Venezuela was producing 2.375 million barrels per day just a year and a half ago in 2015. That means Venezuela is producing 437,000 barrels per day less than it was 2 years ago, which at Venezuela's average 2017 oil price of $43.60 (so far), means that Venezuela is losing over half a billion dollars every month; $6.9 billion a year..."

Despite all this, oil prices are higher today: the international Brent price was up 0.6% to $47.49 per barrel in recent trading, while the U.S. benchmark was up 1% to $45.49. The United States Oil Fund (USO) was up 0.8% and the Energy Select SPDR ETF (XLE) was up 0.5%. Shares of Brazil's state-controlled oil producer and refiner Petróleo Brasileiro or Petrobras (PBR) were up 3.2% after Brazil's securities watchdog reversed a decision ordering the state-controlled company to restate results, Reuters reports. Shares of China Petroleum & Chemical (SNP) were up 1.2%. South African chemicals producer Sasol (SSL) was up 2.6%.

The iShares MSCI Emerging Markets ETF (EEM) was up 1.8% in morning trading, with worries about higher U.S. interest rates pushed down the road after comments by Fed Chair Janet Yellen proved dovish. See our post After Yellen: A Dichotomy In China On Rates & Fed? Also see our free posts:

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