UAE Quietly Boosts Oil Production Capacity Ahead of OPEC Meeting

2024 05


The United Arab Emirates state-owned oil company, Adnoc, has updated its maximum crude oil production capacity figure-and without much fanfare.

ADNOC has quietly updated the figure on its website but did not make an official announcement. The new capacity is 4.85 million barrels per day (bpd)-up from the 4.65 million bpd that it published in 2023. Its published natural gas production capacity is 11.5 bcf per day.

ADNOC has plans to increase its oil production capacity to 5 million bpd by 2027-a target the state-owned oil company set years ago. 

The production capacity hike comes as the UAE’s oil production fell in March, according to OPEC’s secondary sources as the group struggles to bring production down to agreed-upon levels in hopes of balancing the global oil markets.

The UAE-OPEC’s third-largest producer-has clashed with the OPEC group in the past as it is anxiously waiting to boost its oil production and tap its increased capacity. Last summer, the UAE said it would not join in OPEC’s voluntary production cuts and has argued for years that it should be allowed to pump more as it lifts its production capacity. And last June, OPEC+ caved and revised the UAE’s quota up to 3.219 million bpd for 2024.

OPEC’s current production cuts-a “precautionary” measure-are set to run through the end of June, although a June 1 OPEC+ meeting will determine whether OPEC should extend the cuts further or whether they should begin the gradual process of unwinding them.

But OPEC’s Secretary General Haitham Al Ghais warned those who were predicting the beginning of the end of oil should be careful lest those dangerous predictions “foster energy policies that stoke energy chaos.”

OPEC has insisted forecasts that predict the EV revolution and green transition as a whole are not grounded in reality-and that counting on this fictitious oil demand drop-off could lead to policies that would eventually cause the oil supply and demand balance to swing to a deficit, leading to higher oil prices.

By Julianne Geiger for Oilprice.com

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