Platts Says OPEC Production Up 410,000 bpd in September

A further boost in Iraqi production took OPEC's overall crude output to 27.28-mil b/d in September, an increase of 410,000 b/d from August's 26.87-mil b/d, a Platts survey of OPEC and oil industry officials showed October 8.

Excluding Iraq, however, combined output from OPEC's ten members bound by official output quotas was just 10,000 b/d up on August levels at 25.85-mil b/d, the survey showed.

Iraq's continuing efforts to raise production towards pre-war levels produced an additional 400,000 b/d over the month to yield average output of 1.43-mil b/d in September.

Among the OPEC-10, Algeria, Iran, Kuwait, Libya, Nigeria and Qatar pumped an additional 170,000 b/d between them. The only significant cut came from Saudi Arabia, whose production dropped from 8.65-mil b/d in August to 8.5-mil b/d in September. UAE output fell slightly, by 10,000 b/d, to 2.26-mil b/d.

The OPEC-10 exceeded their current 25.4-mil b/d ceiling--which remains in effect until the end of October--by 450,000 b/d, the survey showed.

"Consumers and OPEC see a world that is vastly different, far more different than their usual split in perspective," said John Kingston, global director of oil at Platts. "Consumers see high gasoline numbers at the pump and are baffled by news reports that OPEC is cutting back in order to stem any fall in prices. Meanwhile, OPEC sees a world in which, as our survey shows, Iraqi production rose 400,000 b/d in a month, is continuing to gain on the levels the country produced pre-war, and it confronts the very real prospect of 3-million b/d coming out of there by the end of 2004. It is a prospect that scares the OPEC countries greatly, and the group wants to tackle that issue sooner rather than later."

OPEC ministers meeting in Vienna Sep 24 took markets by surprise with a decision to cut the current ceiling by 900,000 b/d to 24.5-mil b/d from the beginning of November. Some ministers have warned that further cuts may be necessary to support prices, which they say could come under pressure from rising commercial inventories, higher non-OPEC output and recovering Iraqi production.

This means that the OPEC-10 need to cut output by 1.35-mil b/d by Nov 1 to comply with the new ceiling.

But some analysts and industry officials believe that OPEC-10 production could increase further in October as some members take the opportunity to maximize their output before the new cuts come into effect.

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