Investigation: OPEC Oil Production Sees Largest Decline in Decades in March

On April 7, a survey by foreign media revealed that OPEC’s crude oil production experienced its largest decline in at least forty years in March, due to conflicts in the Middle East suppressing exports from major member countries. The survey indicated that OPEC’s daily production plummeted by 7.56 million barrels (approximately 25%) to 22 million barrels. According to data compiled by institutions since 1989, the production drop in March marked the largest single-month decline. This decrease in volume also surpassed the Arab oil embargo of 1973. According to Daniel Yergin’s book ‘The Prize: The Epic Quest for Oil, Money & Power’, during that period from October to December, the market faced an overall loss of 5 million barrels per day, although that shock occurred in a much smaller global market. The survey showed that Iraq, the OPEC member most reliant on the Strait of Hormuz, experienced the largest production drop, with a decrease of 2.76 million barrels to 1.63 million barrels per day. Saudi Arabia and the UAE followed, benefiting from their ability to partially divert exports through alternative oil pipelines. Saudi Arabia’s production fell by 2.07 million barrels to 8.36 million barrels, while the UAE’s production decreased by 1.44 million barrels to 2.16 million barrels. Despite Saudi Arabia’s ability to export through the Red Sea, tanker tracking indicated that Saudi exports in March dropped by about 50%.