OPEC member countries oil output fell in October

OPEC oil output fell in October, due to lower output from member countries Nigeria, Saudi Arabia, and Iraq. Iraqi output slipped because of a one week shutdown of Iraq’s pipeline to Turkey. This drop marks the first monthly decline in supply since April, six months ago.

Oil supply from the OPEC member countries bound by output targets, fell to 26.38 million barrels per day (bpd) from 26.40 million bpd recorded in September, according to a Reuter’s survey of oil firms, OPEC officials, and analysts.

Supply was 1.54 million bpd higher in October than the implied target for member countries 24.84 million bpd. The implication of this is that the group lowered output by 2.66 million bpd of the promised curbs. That gave a 63 percent compliance rate, unchanged from September.

OPEC agreed to reduce supply by a total of 4.2 million bpd in September 2008 amid a fall in oil prices after reaching a record $147 per barrel in August. A cut of 2.2 million barrels per day took effect from January 1, 2009, while the outstanding two million bpd came from previously agreed curbs.

OPEC quotas exclude condensate and natural gas liquids and apply to supply rather than wellhead output, defined to exclude movements to, but not sales from, storage.

According to the OPEC Monthly Oil Report for October, “Africa oil production is forecast to decline by a minor 40,000 barrel per day to average 2.73 million barrels per day in 2009, a downward revision of 25,000 barrels from the previous month’s level. The report stated that “minor upward revisions were introduced to the Gabon oil forecast following new production data. The quarterly distribution average now stands at 2.73 mb/d, 2.73 mb/d, 2.74 mb/d and 2.71 mb/d, respectively for the countries mentioned above.

However, “Until there is a clearer picture about the pace of the global recovery, the outlook for oil and other commodities will continue to be highly dependent on economic signals. Given weak oil market fundamentals as reflected in high global inventories and large OPEC spare capacity, there is a need for continued close monitoring of both economic conditions and developments in the oil market.

Tags:  oil output, OPEC members