As the compliance within the OPEC slipping, the oil production from the OPEC cartel is set to rise for a third consecutive month in July, according to a report by oil consultancy firm, Petro-Logistics. After declining by 153,000 barrels in April on a monthly basis, oil production increased sharply in May and in June. In May, production increased by 366,000 barrels per day and in June, production increased by 393,000 barrels per day. Two exempted countries, Libya and Nigeria accounted for almost 70 percent of the increase in the previous two months. Now, the report from Petro-Logistics suggests that it will rise again in July by at least 145,000 barrels per day.

Despite remaining compliant on an average with the OPEC production agreement, which was extended for nine months until March 2018 at the OPEC meeting in May, the production from the cartel surpassed that imposed ceiling in June, for the first time since the commencement of the deal in January. Last week, Ecuador announced that it is going to opt out of the agreement due to financial and budgetary pressure and became the first country to exit the agreement. The price of oil, which failed to regain its bullish footing despite the OPEC agreement and supply reduction might force other countries to join Ecuador in the coming months if the situation doesn’t improve.

Meanwhile, the increased production in the United States, which recovered by more than a million barrels per day since the bottoming in last July, continues to undermine the OPEC supply reduction agreement.

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