Middle East Oil Production Recovers to 15 Million Bpd
Crude oil production in the Middle East has rebounded to an estimated 14.6 to 15 million barrels per day (bpd) earlier this month, signaling a significant recovery amid improving geopolitical conditions. This comes following a period of restraint related to tensions between Iran and the United States, with experts now forecasting a return to pre-conflict production levels sooner than previously expected.
Rystad Energy, a leading energy research consultancy, recently shared projections indicating that full recovery to pre-war production levels could be achieved by the end of the year. Initially, the consultancy had anticipated this milestone to be reached three months later. The update reflects progress in peace negotiations, although recent reports of new skirmishes between the US and Iran add uncertainty to the outlook.
The consultancy highlighted that the key factor in sustaining production normalization remains unhindered activity in the Strait of Hormuz, a critical chokepoint for oil shipping. The reassurance of uninterrupted navigation through this maritime corridor continues to be vital for regional supply stability and market confidence.
Further, Rystad Energy expects the amount of shut-in production across the region to fall significantly — from the current estimated 9.6 million barrels per day (down from 11.7 million barrels per day three weeks earlier) to less than 2 million barrels daily by the end of September. This improvement has been widespread, affecting multiple countries in the Middle East.
Rystad MENA research director Aditya Saraswat indicated that Iran is leading the recovery due to a shorter duration of shut-ins and minimal upstream damage. In parallel, Kuwait has lifted all force majeure declarations and has started offering cargoes for July through tenders, while Saudi Arabia aims to reach a record output of 4.5 million bpd at its Yanbu terminal this month.
Iran’s crude oil production is projected to increase substantially as well, rising from the current 2.4 million bpd to 3.1 million bpd by August. If the United States decides to extend the existing sanctions waiver beyond its current expiration in August, Iran’s output could reach 3.3 million bpd by the end of the year.
Overall, these developments contribute to optimistic forecasts regarding the restoration of Middle Eastern oil supplies, a crucial element for global energy markets. However, experts remain vigilant about the geopolitical backdrop, particularly the stability of the Strait of Hormuz and ongoing diplomatic engagements.