OPEC Output Up 50,000 Barrels Per Day in September, According to Platts

OPEC's 11 members produced an average 30.31 million barrels per day (mil b/d) of crude in September, 50,000 b/d more than August's 30.26-mil b/d, as Iraqi production recovered towards the 2-mil b/d mark, a Platts survey of OPEC and oil industry officials showed October 7.

Excluding Iraq, however, production from the ten members with now notional crude output quotas dipped by 50,000 b/d to 28.32-mil b/d, the survey showed.

The biggest single increase came from Iraq, whose September production averaged 1.99-mil b/d, up from 1.89-mil b/d in August. Other small increases of 10,000 b/d each came from Saudi Arabia, whose output averaged 9.56-mil b/d, and the UAE, which pumped 2.48-mil b/d.

"From the consumer point of view, this is discouraging in that about the only thing to get excited about is a minor increase in Iraqi production," said John Kingston, global director of oil at Platts. "It's heartening because Iraq looked a few weeks ago like it might have started a downward spiral. But with so much crude production lost from the two hurricanes in the Gulf of Mexico, this report makes clear that there just isn't that much for OPEC to do to alleviate any shortages in the short term."

Iranian production, which had climbed to 4-mil b/d in July and August, fell back by 50,000 b/d to 3.95-mil b/d. Some industry officials said it was becoming increasingly apparent that Iran had reached its current production limit and had joined the ranks of member countries unable to pump their full quotas. The latest estimate of Iranian production leaves Tehran under- producing its 4.11-mil b/d quota by 160,000 b/d.

Iranian underproduction was significantly less than that of Indonesia and Venezuela, however, which showed output declines of 10,000 b/d each in September to 930,000 b/d and 2.61-mil b/d respectively. Indonesia under- produced its 1.451-mil b/d quota by 521,000 b/d while Venezuela under-produced its 3.223-mil b/d quota by 613,000 b/d.

OPEC's current crude output ceiling is set at 28-mil b/d, but the group has encouraged overproduction beyond this level in hope of cooling down overheating oil prices.

That has proved a vain hope, not least because - with the exception of Saudi Arabia - most OPEC member countries are unable to pump more than they are currently producing. Between April and September, OPEC has increased production by just 350,000 b/d despite the price surge that took US West Texas Intermediate crude futures from just under $51/bbl on May 2 to more than $70/bbl in late August as Hurricane Katrina hit the southern US. WTI was trading Friday between $61 and $62/bbl - still more than $10/bbl higher than prices of early May.

    Country-by-country breakdown of production with figures in millions of
b/d:

    Country       Sept 05   Aug 05  July 05  June 05  May 05  Apr 05   Quota
    Algeria        1.350    1.350    1.340   1.330    1.310   1.300    0.894
    Indonesia      0.930    0.940    0.940   0.950    0.950   0.950    1.451
    Iran           3.950    4.000    4.000   3.990    3.980   3.950    4.110
    Iraq           1.990    1.890    1.960   1.850    1.820   1.860      N/A
    Kuwait         2.550    2.550    2.550   2.550    2.550   2.500    2.247
    Libya          1.650    1.650    1.650   1.630    1.630   1.620    1.500
    Nigeria        2.450    2.450    2.450   2.450    2.400   2.370    2.306
    Qatar          0.790    0.790    0.780   0.780    0.780   0.780    0.726
    Saudi Arabia   9.560    9.550    9.500   9.500    9.550   9.500    9.099
    UAE            2.480    2.470    2.450   2.430    2.400   2.450    2.444
    Venezuela      2.610    2.620    2.630   2.640    2.650   2.680    3.223
    Total         30.310   30.260   30.250  30.100   30.020  29.960      N/A
    OPEC 10       28.320   28.370   28.290  28.250   28.200  28.100   28.000
    (excluding
     Iraq)