OPEC 10 cheating climbs above two million bpd
The crude output of the Organization of Petroleum Exporting Countries (OPEC) climbed again in August to average 25.39 million barrels per day (bpd) over the month, a 190,000 bpd increase from July's 25.2 million bpd, a Platts survey of OPEC and oil industry officials showed September 5.
Excluding Iraq, whose exports are controlled by the United Nations, the ten members with quotas under the 21.7 million bpd production ceiling pumped 23.74 million bpd, up 240,000 bpd from July's 23.5 million bpd.
The latest estimate for OPEC 10 production takes the level of cheating to 2.04 million bpd from 1.8 million bpd in July. Only Indonesia produced within quota. The biggest single increase—80,000 bpd—came from Venezuela, whose August output was estimated to have averaged 2.8 million bpd against 2.72 million bpd in July.
Iran boosted production from 3.39 million bpd in July to 3.45 million bpd in August, an increase of 60,000 bpd. Other smaller increases came from Algeria, which has been steadily boosting its production, Indonesia, Kuwait, Libya, Nigeria, Qatar and the United Arab Emirates (UAE).
"The continuing rise in OPEC output sets up an interesting scenario for the mid-September meeting," commented John Kingston, Platts' global director of oil. "OPEC can choose to increase its quota, making itself look good in a world burdened by $28 oil prices—but this will simply legitimize what it already is producing. After months of fairly good discipline, the growing level of output supports the idea that as prices climb, OPEC compliance with individual ceilings inevitably declines."
Of the ten members with quotas, Saudi Arabia was the only country not to boost output month-to-month. Riyadh maintained production at the July level of 7.65 million bpd, although it overproduced its 7.053 million bpd quota by nearly 600,000 bpd.
Saudi Arabia, Venezuela—which overproduced its 2.497 million bpd quota by 300,000 bpd, and Iran—which exceeded its 3.186 million bpd quota by 264,000 bpd, between them accounted for more than half of OPEC's August overproduction.
Iraq, estimated to have produced 1.65 million bpd in August against 1.7 million bpd in July, was the only country to show an output decline. Baghdad's 50,000 bpd decrease only partially offset 240,000 bpd in combined increases from Algeria, Indonesia, Kuwait, Libya, Nigeria, Qatar, the UAE and Venezuela.
Platts is the energy information, research, consulting and marketing services unit of The McGraw-Hill Companies. — (menareport.com)
© 2002 Mena Report (www.menareport.com)