The Organization of the Petroleum Exporting Countries(OPEC) crude oil production rose to 28.94 million barrels per day (b/d) in November, an increase of 50,000 b/d from an estimated October level of 28.89 million b/d, a Platts survey of OPEC and oil industry officials and analysts showed Friday.
“OPEC’s output is rising, the sweet spot of prices in the $75- to $80-per barrel (/b) level is starting to become part of the past, and the demand-intensive fourth quarter is ending,” said Platts Global Director of News John Kingston. “It’s very possible that the upcoming December 22nd OPEC meeting in Angola, expected to be uneventful and predictable, may have a bit more uncertainty hanging over it if we get a few more days of declining prices going into it,” Kingston added.
Excluding Iraq, the 11 OPEC members bound by production quotas pumped an average 26.49 million b/d in November, or 90,000 b/d more than estimated October output of 26.4 million b/d, the survey found.
Increases totalling 120,000 b/d from Ecuador, Nigeria, Qatar, Saudi Arabia and Venezuela were partly offset by decreases totalling 70,000 b/d from Angola and Iraq.
The latest estimates leave the OPEC-11 exceeding their 24.845 million b/d target by 1.645 million b/d.
Compliance with the 4.2 million b/d of cuts agreed late last year has been declining since April alongside a broad firming of oil prices. Having peaked at close to 82% in March, compliance fell to 60.8% in November.
OPEC looks set to roll over its official output target for the fourth time this year when ministers meet in Luanda, Angola.
In September, when ministers last met, they said that although the outlook for oil market fundamentals was gloomy, they did not want to take any action on production that might endanger global economic recovery despite the steady rise in actual output.
The likelihood of OPEC maintaining its current official output targets at the Angola meeting has risen substantially over the past week, with Saudi Arabian oil minister Ali Naimi describing current oil prices of between $70 and $80/b as “perfect” and questioning the need for the oil producing nations to adjust desired output levels.
The roll call of ministers lining up behind a rollover had already been a substantial one, but with OPEC kingpin Saudi Arabia now signalling that the group is preparing to rubber stamp its current output agreement for the fourth time this year, the odds have lessened substantially.