The members of the Organization of Petroleum Exporting Countries (OPEC) produced an average 32.03 million barrels per day (b/d) of crude oil in December, according to a Platts survey of OPEC and oil industry officials January 14. This is up from November's rate of 31.65 million b/d.
Production from OPEC's ten members bound by crude output agreements averaged 27.43 million b/d in December, the survey showed. This is 460,000 b/d more than in November and 177,000 b/d higher than the group's 27.253 million b/d target which came into effect at the beginning of November.
"The increase in supply is certainly welcome to this market," said John Kingston, Platts Global Director of Oil. "It appears the group's on track to meet its January target, which is nearly 29.7 million barrels per day for 11 of the members, excluding Iraq."
The bulk of the December output increase was due to higher production from the United Arab Emirates (UAE) as key maintenance programs were brought to a close. UAE production was estimated at 2.5 million b/d, 350,000 b/d higher than November's 2.15 million b/d. Smaller increases of between 10,000 b/d and 40,000 b/d came from Indonesia, Iran, Kuwait, Libya and Saudi Arabia. The OPEC 10 excludes Iraq and new members Angola and Ecuador.
Iraqi production was estimated at 2.3 million b/d, some 100,000 b/d lower than in November. (Earlier this month, Iraqi oil ministry data obtained by Platts showed total Iraqi output at 2.475 million b/d in December, despite a sharp fall in exports from November levels. But Platts' methodology for calculating output differs from that of the Iraqi government). Angolan production edged up from 1.78 million b/d to 1.8 million b/d. Ecuador, which left OPEC in the early 1990s but resumed its membership in mid-November, produced an estimated 500,000 b/d.
When OPEC met in Abu Dhabi in December it left the OPEC-10 target of 27.253 million b/d unchanged but allocated targets of 1.9 million b/d and 520,000 b/d to Angola and Ecuador from the beginning of January. OPEC's production target rose to 29.673 million b/d on January 1, 2008. Iraq does not participate in OPEC output agreements because it is in process of rebuilding its oil industry after years of United Nations sanctions followed by a US-led war.
OPEC ministers will meet in Vienna on February 1. The beginning of this year saw US light crude prices climb above $100/barrel, but several top OPEC officials have said the high prices have less to do with any shortage of crude than to do with non-fundamental factors such as geopolitics and speculative activity in futures markets.
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