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OPEC Guide



OPEC Aug crude oil output 32.65 mil b/d, down from July on Libya outages: Platts survey

September 7, 2017 — By Herman Wang, Eklavya Gupte



  • OPEC output about 630,000 b/d above stated ceiling
  • Saudi output 10.01 mil b/d; Iraq 4.46 mil b/d; Iran 3.83 mil b/d
  • Exempt Libya, Nigeria combined Aug output 480,000 b/d above Oct


OPEC's crude oil output fell in August for the first time in five months, as outages in Libya interrupted the country's recent dramatic recovery, more than offsetting gains in Nigeria, according to the latest S&P Global Platts OPEC survey released September 7.


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Saudi Arabia, Iraq and Gabon also produced fewer barrels in August, while Angola raised its output in the month. In all, the 14-country bloc produced 32.65 million b/d in August, a 170,000 b/d drop from July, the survey found.


Libyan output, which had risen to 990,000 b/d in July, tumbled to 830,000 b/d in August as militants blockaded key fields Sharara, Elephant and Hamada.


Libya's National Oil Corp. said in the week ended September 1 more than 360,000 b/d of production from the three fields had been shut in, although sources told Platts late September 6 that flows from the 300,000 b/d Sharara and 10,000 b/d Hamada fields had resumed.


Production also restarted at the 90,000 b/d Elephant field on September 2, sources said. Nigerian production, meanwhile, rose 50,000 b/d to 1.86 million b/d in the month, as the country's output continues to rebound from civil unrest.


Analysis continues below...


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In a podcast last week, Nigerian oil minister Emmanuel Kachikwu suggested that the country's production was close to full capacity, linking the rise in output to increased investment by foreign companies on relative calm in the Niger Delta oil province.


Nigeria lifted force majeure on loadings of key export grade Bonny Light in August.


Libya and Nigeria are exempt from OPEC's landmark production cut agreement, and their recovery over the past few months had led to talks among the coalition on whether the two should be asked to join in on the cuts, although Libya's setback in August may quell some of that discussion.


Representatives from Libya and Nigeria have been invited to the September 24 meeting of the OPEC/non-OPEC monitoring committee overseeing the deal to explain their production outlooks.


The two members' combined August average output was 480,000 b/d above their level in October, the benchmark month from which OPEC based its production cuts and quotas.


The agreement, which went into force January 1, calls on OPEC and 10 non-OPEC producers, led by Russia, to cut a combined 1.8 million b/d in output through March 2018 in order to rebalance the market and induce draws of oil in storage.


OPEC's collective output for August is about 630,000 b/d above its declared ceiling under the deal of about 31.9 million b/d, when Equatorial Guinea, which joined in May, is added in and Indonesia, which suspended its membership in December, is subtracted.


SAUDIS STILL LEAD ON COMPLIANCE


Not including the two exempt countries, compliance among OPEC's 12 members with quotas under the production cut agreement remains robust at 112%, down slightly from 114% in July, based on an average of January through August output, according to Platts survey figures.


But while collective compliance with the cut agreement is strong, results among individual countries are still uneven. Seven members have cut in excess of their required levels in the eight months of the deal so far, led by Saudi Arabia, whose January-August average output of 9.971 million b/d is 87,000 b/d under its quota of 10.058 million b/d.


Saudi production in August was 10.01 million b/d, the Platts survey showed.


That leaves five countries that are non-compliant with their quotas, ranging from the UAE, which is over its allocation by 2,000 b/d, to Iraq, which has exceeded its quota by the most, 82,000 b/d, based on January-August averages.


Iraq, OPEC's second largest member, produced 4.46 million b/d in August, according to the survey, while third largest member Iran produced 3.83 million b/d in the month, above its quota of 3.797 million b/d.


Both Iraq and Iran have said they would support extending the deal past its March 2018 expiry, as Saudi Arabia and Russia have advocated, if market conditions warrant and there is sufficient consensus among the producer coalition.


The Platts estimates were obtained by surveying OPEC and oil industry officials, traders and analysts, as well as reviewing proprietary shipping data.


S&P Global Platts OPEC survey methodology


Since 1988, S&P Global Platts has published a monthly survey tracking OPEC crude oil production by country. The estimates are obtained through a review of proprietary shipping data, news reportage and surveys of knowledgeable sources.


Data reviewed include loading programs, export statistics and tanker tracking via Platts cFlow. Sources interviewed for the survey include national oil company or ministry officials; analysts at international agencies, think tanks, consultancies and banks; and traders. The sources remain confidential and are interviewed by a team of Platts oil news reporters -- typically led by Herman Wang, Platts OPEC correspondent, and Eklavya Gupte, Platts senior editor for Europe and Africa news.


The survey is typically published between the 5th and 10th of each month, and it measures oil output -- excluding condensates and NGLs.








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