After running setup:upgrade and di compile from the bin directory, permission and ownership is reset and the magento store stops working. It works if I manually reset the permission.

When the var/generation/Magento directory is owned by sohaib/www-data (sohaib is my current username) the website is loading properly.

When I run the bin/magento setup:upgrade command, the ownership has changed and the website is throwing errors.

With regards to Mohammad's answer, permissions should never be set to 777.

The problem here is that newly generated files are owned by the user and group who issues the command $USER:$USER, where they should belong to $USER:www-data or $USER:apache. Because apache2 does not have access to the group $USER, the website cannot be properly served.

In order to retain proper permissions, magento commands should be executed as the apache user.

For example:

Ubuntu

$ sudo -u www-data php bin/magento setup:upgrade

CentOS

$ sudo -u apache php bin/magento setup:upgrade

This way, new files are owned by www-data:www-data (in the case of ubuntu).

So long as you have properly followed Magento's documentation with regards to permissions and added the cli user to the apache2 group, then you will have proper access to the files.

If you did not follow this documentation then you can execute the following command to do so:

Ubuntu

$ sudo usermod -a -G www-data $USER

CentOS

$ sudo usermod -a -G apache $USER

Note:

In order that commands can be executed without declaring the apache2 user, Daniel's answer explains that we can modify how the Magento framework sets permissions for new files.

If you are having trouble installing/updating via composer or deploying to production, then you can simply grant ownership of any inaccessible files (these are highlighted yellow in the terminal) to www-data by issuing the following command:

sudo chown www-data:www-data "/absolute/path/to/file.json"

Then, follow BrunoBueno's answer, applying the above fix:

$ sudo -u www-data bin/magento setup:upgrade
$ sudo -u www-data bin/magento indexer:reindex
$ sudo -u www-data bin/magento deploy:mode:set production -s
$ sudo -u www-data bin/magento setup:di:compile (Here was the secret, to run the di:compile after production)
$ sudo -u www-data bin/magento setup:static-content:deploy

Just change the permission of magento's Var from Magento root directory...

Run below command from magento root:

chmod -R 777 var/

if still you are getting same error then change the permission of full magento directory as per magento official document.

Magento file system ownership and permissions

Hope this will resolve your problem.