Platts Survey: OPEC Oil Output Falls in January, But Above Target

The 10 OPEC members bound by the cartel's output agreements produced an average 26.95 million barrels per day (b/d) in January, down 50,000 b/d from December's 27 million b/d, but still well above the group's November 2006 and February 2007 targets, a Platts survey showed February 9.

Total OPEC output, including volumes from Iraq and new member Angola, averaged 30.11 million b/d in January, 1.21 million b/d higher than December's 28.9 million b/d, the survey showed. Iraq does not participate in OPEC output agreements, while Angola, whose membership of the cartel is just over a month old, has yet to accept or be allocated any output target.

The survey showed that the so-called OPEC-10 in January were still 650,000 b/d above their 26.3 million b/d target output level which came into effect on November 1, 2006. This target was superseded on February 1, 2007 by a new, lower output target of 25.8 million b/d following OPEC's mid-December decision to expand the 1.2 million b/d production cut agreed in October to 1.7 million b/d.

"OPEC's output has not declined much from what it was in December, but from OPEC's perspective, that's OK," says John Kingston, Platts global director of oil. "Firm prices near $60 mean the group's current production levels are not excessive relative to demand."

But the second quarter looms, and that is traditionally the weakest demand quarter, he cautions. "If OPEC wants to defend current prices near $60 it may prove difficult to do if the group's production levels stay just under 27 million barrels per day. Most other projections see the market's need for OPEC oil in the second quarter to be less than that."

Output decreases totaling 70,000 b/d from Algeria, Libya, Saudi Arabia and Venezuela were partly offset by a 20,000 increase in Nigerian production, which edged up to 2.25 million b/d from 2.23 million b/d.

Iraqi volumes were sharply down in January, partly as a result of the main Gulf export terminal at al-Basrah being closed for three days to install refurbished measuring meters. Bad weather also took its toll on exports.

The survey estimated Angolan production at 1.5 million b/d. Angolan production has been rising steadily in recent years. Oil minister Desiderio da Graca Verissimo e Costa said in December that Angola was aiming to achieve crude production of 2 million b/d by mid-2007, several months earlier than previously targeted.

    Country    January   December  November  October   September   Nov 1 cut
    Algeria      1.340      1.350     1.350    1.370       1.360       0.059
    Indonesia    0.860      0.860     0.860    0.860       0.860       0.039
    Iran         3.850      3.850     3.850    3.900       3.950       0.176
    Kuwait       2.460      2.460     2.460    2.530       2.540       0.100
    Libya        1.690      1.700     1.710    1.730       1.720       0.072
    Nigeria      2.250      2.230     2.230    2.300       2.300       0.100
    Qatar        0.800      0.800     0.800    0.830       0.830       0.035
    Saudi Arabia 8.750      8.790     8.800    9.070       9.100       0.380
    UAE          2.500      2.500     2.550    2.600       2.600       0.101
    Venezuela    2.450      2.460     2.460    2.540       2.550       0.138
    OPEC-10     26.950     27.000    27.070   27.730      27.810       1.200
    Angola       1.500       N/A       N/A      N/A         N/A         N/A
    Iraq         1.660      1.900     1.990    2.020       2.140        N/A
    Total       30.110     28.900    29.060   29.750      29.950      1.200


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