US sees non-OPEC oil output growth ending in 2011

The world will become more dependent on OPEC oil beginning in 2011 as the combined non-OPEC oil output from countries outside of the producer group begins to decline, the US government said on Tuesday.

The EIA said in its new monthly forecast that non-OPEC oil supplies will not sustain the 630,000 barrel-per day-increase experienced in 2009. Output growth is expected to slow to 420,000 bpd this year when production reaches an average 50.7 million bpd and then decline by 140,000 bpd in 2011.

This year’s growth in non-OPEC output reflects new projects in Brazil, the United States and the former Soviet states of Azerbaijan and Kazakhstan offsetting declining production from mature oil fields in Mexico, the United Kingdom and Norway.

But next year the output drop at these mature fields will overtake the production growth from the new fields, according to the EIA. The EIA’s forecast slowdown in non-OPEC production will have important implications for world oil markets.

“The immediate impact of the slow growth in non-OPEC liquids production in the forecast period is an increased role for OPEC in the world oil market,” the agency said. The world will need more OPEC oil as the EIA estimates that global oil demand will be almost 2.6 million barrels per day higher in 2011 than compared to last year.

As a result, the agency said OPEC’s share of global oil supplies could increase to 42 percent next year, up from 40 percent in 2009 and 38 percent in 2003. “Combined with its maintenance of high levels of surplus production capacity, the lack of sizable growth in non-OPEC liquids supply gives OPEC greater influence over the world oil market,” the EIA said.

News Source: Reuters

Tags:  2011, oil output, OPEC, US