The Organization of the Exporting Countries (OPEC) produced an additional 200,000 barrels per day (bpd) of crude oil in May, boosting output to 29.04 million bpd from 28.84 million b/d in April, according to a Platts survey of OPEC and oil industry officials and analysts.
Saudi Arabia accounted for most of the additional barrels. Riyadh vowed to meet increasing world demand after OPEC’s last meeting on June 8.
You can see that the task ahead for Saudi Arabia, and any other nation determined to meet what is expected to be steadily increasing demand, is substantial,” said John Kingston, Platts global director of news.
The last OPEC meeting, which Saudi Oil Minister Ali bin Ibrahim Al-Naimi called the “one of the worst meetings we have ever had” ended early after delegates could not agree whether to raise production.
“OPEC produced 29.8 million bpd before the Libyan uprising, its climbing back above 29 million bpd with the increases of the past month,” Kingston added.
“Most supply/demand estimates see an absolute minimum need for output of 30 million b/d in the second half of the year. It’s a large jump, and all eyes will be on Saudi Arabia to see if it can get the job done,” he said.
Excluding Iraq, which does not participate in OPEC output agreements, the 11 members bound by quotas (OPEC-11) increased output by 160,000 bpd to 26.34 million bpd in May from 26.18 million bpd in April, the survey showed. This left OPEC-11 overproducing their notional 24.845 million bpd target by 1.5 million bpd.
But that target, in place since January 2009, is now redundant following the failure of OPEC’s June 8 ministerial meeting in Vienna to reach an agreement on output.
Saudi Arabia, which had been producing well above its notional OPEC quota – published country-by-country quotas were abandoned in 2007 – of just over 8 million bpd for some time, increased output by some 200,000 bpd in May, to 9.05 million bpd from 8.85 million bpd in April.
Other increases came from Nigeria, Qatar and Venezuela, while volumes dipped in Algeria, Angola, Iran, Libya and the UAE. Libyan crude production had been running close to 1.6 million b/d before the rebellion against the regime of Moammar Qadhafi, now in its fifth month, but dropped to an average of around 160,000 bpd in May from 200,000 bpd in April.
Saudi-owned newspaper al-Hayat reported on 10 June that the country planned to raise oil production to 10 million bpd in July and to maintain that level for a month before reducing output in August in line with an expected dip in demand.
