The gap between world oil production and consumption grew even wider in the second quarter, adding to the largest supply glut in modern times and helping push oil prices to within sight of six-year lows.
Oil producers in the Organisation of the Petroleum Exporting Countries, OPEC, pumped 31.25 million barrels of oil per day (bpd) in the second quarter, up from 30.44 million bpd in the first three months of the year, based on Reuters surveys.
Demand for OPEC crude oil, on the other hand, remained unchanged in the second quarter at 28.26 million bpd, analysts say, meaning the market was over-supplied by as much as 3.09 million bpd, up from 2.18 million bpd in the first three months of the year.
“The imbalance between global oil supply and demand peaked in 2Q15. But the glut in the coming quarters will still continue, averaging 1 million bpd over the next 18 months,” Bank of America-Merrill Lynch analysts wrote on Tuesday.
“OPEC is largely to blame for this imbalance, with Saudi Arabia, Iraq, the UAE and now Iran raising crude output into a falling price environment.”
At its last meeting in June, OPEC agreed to maintain its target of 30 million bpd for the second half of 2015. Yet OPEC’s largest members, Saudi Arabia and Iraq, increased production in order to retain market share, particularly in Asia.
The price of a barrel of oil is now around 8 percent below where it was at the end of last year, having shown a year-to-date gain of as much as 20 percent in May.
Benchmark Brent crude futures fell to their lowest in almost six months on Tuesday, dropping by $1.19 on the day to a session trough of $52.28 a barrel. In January, Brent touched $45.19, its lowest since early 2009.
Supply from non-OPEC sources, such as U.S. shale oil, and slowing emerging market demand have also dragged on oil prices.

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