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OPEC Shortfall Amps Energy Crunch

FILE: Representative illustration of an oil pump jack, taken 4.8.2020

The OPEC+ group produced almost 3 million barrels per day less crude than foreseen by its quotas in June as sanctions on some members and low investment by some others crippled its ability to assuage the worlds energy crisis, a report showed Friday.

Russian Interfax news agency, citing a source familiar with the data, said level of underproduction by OPEC+ jumped to 320% in June from 256% in May and 220% a month earlier.

It also said that the OPEC+ group's combined oil underproduction from the planned levels was 2.84 million barrels per day last month.

OPEC+ will consider keeping oil output unchanged for September when it meets next week, despite calls from the United States for more supply, although a modest output increase is also likely to be discussed, eight sources said.

The development is a further setback for the U.S. administration of Joe Biden, which had been hoping that OPEC could raise output to compensate for Russian supply disruptions and slow down rising fuel costs and broader inflation.

Most OPEC producers have suffered from chronic underinvestment due to price downturns in recent years as well as pressure on investors to dump fossil fuel and find alternative energies instead.