LONDON: Opec is already raising oil supply in response to record prices and in advance of its deal to increase output from November, a consultant who tracks tanker movements said yesterday.
Opec’s 10 members subject to output limits, all except Iraq and Angola, are set to pump 27.5mn barrels per day, up from a revised 27.2mn bpd in September, said Conrad Gerber of Petrologistics.
The estimate indicates that Opec may be relaxing adherence to supply curbs in response to a jump in oil prices, which hit a record high of $90.07 on Friday.
The group on September 11 formally agreed to lift production from November 1
“It’s a surprisingly large increase,” Gerber said. “The Saudis are obviously pushing out more crude in advance of the November increase.”
Saudi Arabia, Opec’s top producer, is on course to lift supply to 8.95mn bpd from 8.88mn bpd in September, he said.
Other increases are coming from Iran, which is expected to raise output by 50,000 bpd to 3.95mn bpd and the United Arab Emirates, which is forecast to pump 2.65mn bpd, a gain of 60,000 bpd.
Overall output from the 12-member Opec is set to rise 500,000 bpd to 31.4mn bpd, Petrologistics said, on higher shipments from Iraq and Angola.
Iraqi output is expected to increase to 2.2mn bpd this month, up about 40,000 bpd from September, Gerber said.
Exports are rising because the country is exporting some Kirkuk crude from its northern fields, shipments that have remained sporadic since the US-led invasion in March 2003.
Angolan output, on a rising trend as new fields come on stream, is likely to climb to 1.75mn bpd from 1.6mn bpd in September.
Opec, source of more than a third of the world’s oil, agreed on Sept. 11 to raise output by 500,000 bpd from November 1 in a gesture to consumer nations worried by the economic impact of record prices.
The move followed months of calls for more oil from top consumer the US and the International Energy Agency that represents the interests of 26 industrialised nations.
Opec’s deal, in theory, reverses most of the 1.7mn bpd of supply curbs agreed by the group since October 2006 because the Opec 10 were already pumping above their nominal ceiling.
According to Petrologistics, they are now pumping oil at the same level from which they started cutting production in 2006. Opec said the 10 were pumping 27.5mn bpd before the cutbacks began.
Oil prices declined yesterday after the Petrologistics estimate was released.
Oil prices extended losses amid worries that slower US economic growth could dampen global demand, dealers said.
New York's main futures contract, light sweet crude for delivery in December, shed 67¢ to $85.35.
The November contract had struck a historic high of $90.07 last Friday.
London's Brent North Sea crude for December delivery dropped 45¢ cents to $82.82, after hitting a record 84.88¢ last Thursday.
Crude futures scaled dizzy heights last week owing to tight supplies and geopolitical tensions in the Middle East region.
But prices have since fallen back as weak US economic data has stoked concerns about weakening oil demand in the US, the biggest energy consumer in the world.
Prices have fallen on fresh "concerns over economic growth and, in turn, oil demand growth," Goldman Sachs analysts said.
Additional downward momentum has come from Kurdish rebels offering Turkey a ceasefire on Monday. – Reuters, AFP |
