Excluding Iraq, which does not participate in OPEC output accords, the ten members with output quotas produced an average 26.03-mil b/d, down 120,000 b/d from January's 26.15-mil b/d. But despite the downward drift in output, the OPEC-10 were still more than 1.5-mil b/d above their current 24.5-mil b/d ceiling and more than 2.5-mil b/d above the 23.5-mil b/d ceiling which is scheduled to come into effect at the beginning of April.
The cartel decided at a February 10 meeting in Algiers to cut quotas by 1-mil b/d from April 1. But with world crude benchmarks close to levels seen ahead of the US-led war on Iraq, there is little expectation that OPEC will reduce actual output over the next few weeks to anywhere near the new official ceiling, despite the group's apparent determination to implement the cut at least nominally.
"There had been some speculation that given high prices, OPEC members might not actually implement the cuts in April, giving some relief to consumers," said John Kingston, global director of oil at Platts. "But the Saudis have signaled clearly that they will cut 5-6%, on average, as of April 1, so we can expect to see these latest numbers down further in the next two months."
"Another factor OPEC will be looking at closely will be the return of some exports of Iraqi crude from the Turkish port of Ceyhan and the return of export operations at Khor al-Amaya," Kingston said.
OPEC's own crude basket stood at $31.67/bbl March 10, its 67th straight trading day above the cartel's $22-28/bbl target band.
A senior OPEC delegate March 10 reiterated the cartel's determination to go ahead with the April 1 cut, citing members' concern to avoid a larger than normal stock build in the second quarter, but at the same time insisting that if circumstances changed -- either because of higher demand or disruption to supply -- OPEC would ensure the market was provided for.
Saudi Arabia, meanwhile, was one of six OPEC members to reduce output from January levels, the survey showed, but its 8.45-mil b/d February average left it nearly 500,000 b/d above its current 7.963-mil b/d quota. Furthermore, the Kingdom's volume allocations for April, reported by customers March 8 and March 9, suggested that OPEC's top producer was not planning to cut output to anywhere near its new April 1 quota of 7.638-mil b/d, analysts said. In order to meet its new quota, Riyadh would need to slash output by more than 800,000 b/d.
Output decreases totaling 220,000 b/d were partially offset by 50,000 b/d in combined increases from Iran, Libya and Nigeria. Only Venezuela and Indonesia produced within quota, with Venezuela under-producing its 2.819-mil b/d quota by close to 280,000 b/d.
Country-by-country breakdown of production with figures in millions of b/d:
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