Saudi Arabia has raised its oil output to the highest level on record. The kingdom reported that oil production surged to 10.6 million barrels a day in June, an increase of more than 200,000 b/d from the previous month. If Saudi Arabia keeps increasing production at this rate, by the end of this summer the country could be the first to pump 11 million b/d of crude since the former Soviet Union.
The notable increase in oil production is aimed at meeting seasonal demand for air-conditioners which is especially high in the countries with the desert climate in summer.
International oil prices have averaged more than $60 a barrel since April approaching levels that may allow US shale and other higher-cost producers to lock in prices that will let them keep on producing.
Riyadh said it wants a market share to shift back to countries with the cheapest production. Production costs in Saudi Arabia and other Gulf OPEC members are in the single digits.
Saudi Arabia is the largest producer with significant spare capacity. The kingdom accounts for 15% of the global oil resources equal to 260.2 billion barrels. In April 2015, Saudi Arabia reached a 10-year tally of its oil output with 10.3 billion b/d.
