Oil production for the Organisation of Petroleum Exporting Countries fell below 30 mln barrels per day in August, after output declines in Iraq and Iran dented group output which remains close to capacity, with the exception of Saudi Arabia.
The Middle East Economic Survey reported Monday that total OPEC output fell in August by 115,000 bpd to 29.925 mln bpd from 30.04 mln in July.
The report came as OPEC oil ministers were gathering in Vienna to raise production quotas by 500,000 or even 1 mln barrels before the onset of winter, with doubts whether the renewed increase will immediately lower current record oil prices.
OPEC Ten production, excluding Iraq, was down just 45,000 bpd in August at 28.045 mln bpd, compared to 28.09 mln in July.
This put production levels just a mere 45,000 bpd above the 28 mln bpd ceiling which came into effect on July 1.
Iranian production continued its downward trend in August for a third consecutive month led by lower exports, the MEES report added.
The National Iranian Oil Company (NIOC) has shut down production of around 90,000 bpd of crude oil in the Nowruz field, less than a month after the production facilities were formally handed over by project developer Shell.
Iraqi production fell due to lower exports from the southern terminals after power disruptions and by limited liftings from the Turkish Mediterranean terminal of Ceyhan in the month.
In Nigeria, continued community strife temporarily hit production operated by Shell and Total in the month leading to overall losses of 50,000 bpd in August.
Saudi Arabia has continued to produce at just above 9.5 mln bpd and has reiterated its readiness to increase supplies to 11 mln barrels should market demand warrant it.
But Saudi Arabia and other producers from the Middle East are already having problems selling their “heavy crude” oil with its large sulphur content and complicated refining processes.
A further raise in OPEC production to 28.5 or 29 mln barrels, plus about two mln barrels from Iraq, would probably heighten already existing oversupply.
This in turn could ultimately strengthen the trend to lower prices, and – according to hopes in Vienna – increase demand for OPEC oil again.
A spokesman of the cartel, which is responsible for about 40% of world oil production, said in Vienna on Sunday, prior to the ministerial meeting: “We must find a middle way between the needs of the market and those of OPEC.”
