OPEC output falls to lowest level in 37 years

OPEC crude oil production fell in May to its lowest level in at least 37 years, as the U.S. blockade on Iran and ongoing disruptions in the Persian Gulf continued to constrain output, according to a Bloomberg survey.

Production from the organization’s 11 current members declined by 1.22 million barrels per day to 16.33 million barrels per day last month. Iran accounted for more than half of the decline. The figures exclude the United Arab Emirates, which left the Organization of the Petroleum Exporting Countries last month after six decades of membership.

The war involving the U.S.-Israeli alliance and Iran has reduced oil supplies from the Middle East, largely shutting down the Strait of Hormuz. Saudi Arabia, Iraq, the United Arab Emirates and Kuwait have been forced to cut crude production. Iranian shipments have faced additional pressure following a U.S. blockade on its ports imposed in mid-April.

Iranian production fell by 710,000 bpd to a five-year low of 2.34 million bpd in May, according to the survey. U.S. Central Command reported that American forces have redirected 127 commercial vessels as part of efforts to enforce the blockade on all maritime traffic entering and leaving Iranian ports.

Kuwait recorded the second-largest decline last month, with output falling by 310,000 bpd to 490,000 bpd, less than one-fifth of pre-war levels. Group leader Saudi Arabia saw production decrease by 240,000 bpd to 6.57 million bpd.

The production cuts have not prevented OPEC and its allies from raising output quotas in recent months, continuing a year-long process of restoring output curtailed several years ago.