LONDON, December 8 /PRNewswire/ --
Platts -- The 10 OPEC members bound by the cartel's output agreements produced an average 27.07 million barrels per day (b/d) in November, down 660,000 b/d from October, but still well above the group's new 26.3 million b/d output target, a Platts survey showed December 8.
Based on Platts' figure for OPEC's November production, the group exceeded its 26.3 million b/d target by 770,000 b/d.
"Despite the fact that OPEC's cuts are nowhere near what was targeted, the market still remains solidly above US$60," said John Kingston, Platts global director of oil. "But the group does face a supply/demand equation that is significantly out of whack, to its possible detriment, as the first quarter progresses and goes into the second quarter," he explained.
For this reason, it appears that there is significant support among OPEC ministers to cut crude production again at talks in the Nigerian capital Abuja when the organization meets December 14.
"Statistics and the marketplace continue to signal hefty inventory levels for the immediate future and that's bound to concern OPEC a great deal," Kingston said.
Including Iraq, which does not participate in output agreements, OPEC's 11 members pumped an average 29.06 million b/d in November, 690,000 b/d down from October's 29.75 million b/d.
OPEC agreed at emergency talks on October 19 in Qatar to remove 1.2 million b/d of physical crude supply from world oil markets in an effort to mop up excess supply and prevent high consumer inventories from building further.
Ignoring official but notional output quotas, OPEC said the cut was being made from a baseline figure of 27.5 million b/d, representing September production from the so-called OPEC-10, and that the production target for these 10 members from the beginning of November would be 26.3 million b/d. OPEC did not, however, list baseline levels or target output levels for individual countries.
The survey suggests that no country fully implemented its agreed cut, although few commentators had expected anything approaching full implementation in November, given that the deal had been finalized just 11 days before it was meant to come into effect.
The biggest single cut came from Saudi Arabia, whose production fell by 270,000 b/d to 8.8 million b/d from 9.07 million b/d in October.
Only Indonesia, which had been under-producing its notional 1.451 million b/d quota by more than 590,000 b/d, did not cut production. The country's OPEC governor, Maizar Rahman, said October 30 that Jakarta would not cut, despite having agreed to reduce output by 39,000 b/d, because of "special circumstances." OPEC, he said at the time, "understands our position."
Country November October September Quota Cut Agreed
Algeria 1.350 1.370 1.360 0.894 0.059
Indonesia 0.860 0.860 0.860 1.451 0.039
Iran 3.850 3.900 3.950 4.110 0.176
Iraq 1.990 2.020 2.140 N/A N/A
Kuwait 2.460 2.530 2.540 2.247 0.100
Libya 1.710 1.730 1.720 1.500 0.072
Nigeria 2.230 2.300 2.300 2.306 0.100
Qatar 0.800 0.830 0.830 0.726 0.035
Saudi Arabia 8.800 9.070 9.100 9.099 0.380
UAE 2.550 2.600 2.600 2.444 0.101
Venezuela 2.460 2.540 2.550 3.223 0.138
Total 29.060 29.750 29.950
OPEC-10 27.070 27.730 27.810 28.000 1.200
Web site: http://www.platts.com
Kathleen Tanzy, +1-212-904-2860, Europe: Shiona Ramage, +44207-1766153, Asia: Casey Yew, +65-653-06552
