The organisation of Petroleum Exporting Countries (OPEC) oil production rose in January as record Iraqi output helped drive prices near six-year lows. Production by OPEC climbed 483,000 bopd to 30.905 due to more Angolan exports and steady to higher output in Angola, Saudi Arabia and other Gulf producers. The largest boost this month has come from Angola, which pumped 1.80 million bpd and exported about 57 cargoes, up 160,000 bpd from December. Output would have been higher without some cargo delays, including of new crude Sangos. Nigeria, also managed to boost exports but the increase was restrained by outages of the Forcados and Nembe Creek pipelines.
Output rose even as oil futures dropped to the lowest level since 2009. OPEC left its production quotas unchanged at a November meeting, prompting speculation that the group will let prices slide low enough to slow US output that’s climbed to the highest in three decades.
Output in top OPEC exporter Saudi Arabia has been flat to slightly higher. Khalid al-Falih, Saudi Aramco chief executive said production was currently at 9.8 million bpd, although it was unclear if that was the daily rate or the January average.
The largest reduction this month has come from Iraq, where southern oil exports slipped from December’s record high and flows from northern Iraq also declined. OPEC’s other country with a notable decline in output this month is Libya, where ports and oilfields have been shut due to fighting and supply fell further in January to 350,000 bpd.
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OPEC at a November meeting decided to focus on market share rather than cutting output, despite concerns from members such as Iran and Venezuela about falling oil revenue. At the November 27 meeting, OPEC retained its output target of 30 million bpd, sending oil prices to a four-year low close to $71 a barrel. Crude has since fallen to a near six-year low of $45.19.
Brent crude for March settlement rose 22 cents to $49.35/bbl the London-based ICE Futures Europe exchange in New York. Brent, the benchmark for more than half the world’s oil, touched $45.19 on January 13, the lowest since March 2009.
Iraqi production rose 200,000 bopd to 3.9 MMbopd this month, the biggest gain after Saudi Arabia. Output climbed as the country added growing Kurdish supplies to its exports, while southern oilfields remain unscathed by Islamic State militants. Iraq is OPEC’s second-biggest producer.
Crude output in Iraq hit a record 4 MMbpd, Oil Minister Adel Abdul Mahdi said in Baghdad. The country needs to increase oil production because tumbling global prices have reduced government revenue by about 50 percent, Rowsch Nuri Shaways, Deputy Prime Minister said at the World Economic Forum in Davos, Switzerland.
Last month’s total was revised 183,000 bopd higher to 30.422 MMbopd because of changes to the Iraqi and Ecuadorian estimates.
Output in Saudi Arabia, OPEC’s top producer, climbed 220,000 bopd to 9.72 MMbopd. Shipments to China increased as lower prices encouraged crude storage, according to a person familiar with the matter.
Oil prices continued to slide after the death of King Abdullah on January 23. His successor, King Salman, calmed the market by saying that he will continue his predecessor’s policies and retaining Oil Minister Ali Al-Naimi.
Saudi Aramco and partner Sinopec Group shipped the first gasoline cargo from the new Yasref refinery in Yanbu refinery this month. The plant on Saudi Arabia’s Red Sea coast will have crude-processing capacity of 400,000 bpd.
Angolan production increased 190,000 bopd to 1.81 MMbopd, the third-biggest advance in January. Eni began first production from the West Hub development project in Block 15/06 in December.
Libyan output fell 150,000 bopd to 300,000 in January, the lowest level since June and the biggest decline in the survey. Production has slumped since the 2011 rebellion that ended Muammar Qaddafi’s 42-year rule. The country pumped 1.585 million in January 2011.
