Opec output soars on higher Iraq, Iran exports
London, February 1, 2014
Opec's oil output has risen in January from December's 2-1/2-year low, due to a partial recovery in Libyan supply and higher shipments from Iraq and Iran, a Reuters survey found.
Output from the Organization of the Petroleum Exporting Countries averaged 29.94 million barrels per day (bpd), up from a revised 29.63 million bpd in December, according to the survey based on shipping data and information from sources at oil companies, Opec and consultants.
The survey illustrates the potential for Opec supply to rebound in 2014 if Libya, Iraq and Iran sustain higher output. That could put pressure on oil prices without cutbacks from other members, such as Saudi Arabia.
"Over the next few months, the big challenge for Opec will be to respond appropriately to any further normalisation of oil production in Libya," said Carsten Fritsch, analyst at Commerzbank in Frankfurt.
In January, higher supply in Libya, more Iraqi exports and a further small rise in Iranian shipments outweighed reductions in Angola and Saudi Arabia. December production in Saudi Arabia, Libya and the United Arab Emirates was revised.
Opec's December output was the lowest since May 2011, when the group pumped 28.90 million bpd, according to Reuters surveys. Despite January's increase, supply is below Opec's nominal target of 30 million bpd for a fourth straight month.
Opec's biggest increase came from Libya, as the El Sharara field restarted in early January after protesters ended a blockade. Still, output remains less than half of the 1.4 million bpd the country was pumping last year, and further recovery is by no means assured.
Iraq's oil exports in January rose to 2.45 million bpd, due to higher shipments from southern ports despite some disruption from bad weather. Exports of Kirkuk crude through northern Iraq declined.
Iranian supply to market was estimated at 2.75 million bpd, up 50,000 bpd. The modest pickup is the third consecutive monthly rise, according to sources who track tanker movements, and adds to signs that the easing of sanctions on Tehran is helping it sell more crude.
The largest decline in Opec was from Angola, whose output dropped 120,000 bpd because of reduced shipments of several crude streams including Girassol, Cabinda, Saturno and Palanca.
Saudi Arabia, industry sources say, trimmed output due to a reduced requirement for crude to fuel domestic power plants and lower demand outside the country - although December's supply was higher than earlier thought.
"Exports have been lower than in December, with refinery runs flat and direct burn a bit lower," said an industry source who tracks Saudi output. "So on balance, supply is down."
The kingdom has cut supplies from 10.05 million bpd in August, the highest since records began in 1980, according to figures from the U.S. Energy Information Administration.-Reuters