Saudi oil output rises in May
LONDON: OPEC’s oil output has risen to a three-month high in May, a Reuters survey found on Friday, as increased supplies from Angola and a further gain in exports from southern Iraq outweighed worsening unrest in Libya.
Supply from the Organization of the Petroleum Exporting Countries has averaged 30.02 million barrels per day (bpd), up from 29.68 million bpd in April, according to the survey based on shipping data and information from sources at oil companies, OPEC and consultants.
The increase puts OPEC output above the group’s nominal target of 30 million bpd for the first time since February.
The International Energy Agency on May 15 said OPEC needed to pump more in the second half of the year to meet rising demand.
“For now, it seems to be appropriate,” said Carsten Fritsch, an analyst at Commerzbank in Frankfurt, referring to whether OPEC’s output was sufficient. “For the second half of the year, it might be different.”
Outages mainly in Libya have weighed on OPEC supply this year, helping to keep oil prices above $100 a barrel LCOc1 despite non-OPEC supply growth and the US shale boom.
OPEC pumps a third of the world’s oil. In May, output rose in Angola and Iraq, and to a lesser extent in Saudi Arabia and Iran, the survey found. The most significant drop was in Libya, while Nigerian production barely rose despite the lifting of an export force majeure by Royal Dutch Shell.
The largest rise in May came from Angola, which has exported 59 cargoes, up 11 from April. Three of the extra cargoes came from the BP-operated Plutonio field, which industry sources said had been undergoing maintenance.
Iraq managed again to boost supply due to higher exports from its southern terminals, where shipments have averaged at or near 2.60 million bpd in May, the highest since at least 2003, according to loading data.
The sale of a crude cargo by Kurdistan, in defiance of the central government, also boosted Iraqi supplies. But there were no shipments of Kirkuk crude from northern Iraq, industry sources said, due to earlier bombings, keeping Iraq’s total exports below February’s record.
Iran’s exports climbed in May after dropping in April, tanker data showed, moving further above levels allowed by November’s interim deal on curbing Tehran’s nuclear program. Extra oil is heading particularly to China, industry sources said.
Signs of higher Iranian sales since late 2013 have led to concern in Washington that a softening of sanctions has given Tehran’s economy a boost.
Top exporter Saudi Arabia boosted supply slightly because of a higher need for crude in domestic power plants, industry sources said. Output also edged up in the United Arab Emirates due to the completion of oilfield maintenance.
Libyan output fell by 60,000 bpd to a monthly average of 190,000 bpd, the survey found. Strikes and protests are keeping supply at a fraction of the country’s potential.
OPEC meets on June 11 in Vienna to consider adjusting the 30 million bpd supply target. It is not expected to change the target as oil prices have stayed above $100, the preferred level of Saudi Arabia and many other members, all year.