Organization of the Petroleum Exporting Countries (OPEC)’s oil supply jumped to its highest in almost two years in September, a Reuters survey found, due to further recovery in Libya and higher output from Saudi Arabia and other Persian Gulf producers in the face of sub-$100 per barrel oil prices.
The lack of any cutbacks underlines the relaxed view of OPEC’s core Gulf members to oil’s slide from $115 in June to $97 on Tuesday - a level they can tolerate, but which puts budgets in producers such as Iran and non-member Russia under pressure. Supply from OPEC averaged 30.96 million barrels per day (bpd) in September, up from 30.15 million bpd in August, according to the survey based on shipping data and information from sources at oil companies, OPEC and consultants. OPEC pumps a third of the world’s oil and meets next in November. This month, the largest increase has come from Libya, where supply is up by 280,000 bpd despite conflict. Iraq, Nigeria, Angola and Saudi Arabia also boosted output.
This month’s output is OPEC’s highest since November 2012 when it pumped 31.06 million bpd, according to Reuters surveys. Involuntary outages, such as in Libya, kept output below OPEC’s nominal 30 million bpd target in earlier months of the year.
OPEC’s own forecasts suggest demand for its crude will fall to 29.20 million bpd in 2015 due to rising supply of US shale oil and supplies from other producers outside the group - almost 1.8 million bpd below current output according to this survey.
Iran on Friday urged OPEC members to make joint efforts to keep the market from falling further, but the Persian Gulf Arab producers remain unruffled according to comments from oil ministers and delegates.
Iranian output was steady in September, the survey found. Western sanctions over Iran’s nuclear work are restraining its output, although supply has risen since the start of the year following a softening of the measures. Iran’s budget needs oil prices well above $100, among the highest in OPEC, while the budget of non-member Russia assumes an average of $100.
