LONDON – OPEC oil supply fell in April for an eighth consecutive month due to disruptions to Nigerian output and as members implemented a deal to prop up prices, a Reuters survey showed on Friday.
Supply from the 11 members of the Organization of the Petroleum Exporting Countries bound by output targets declined to 25.52 million barrels per day (bpd) from a revised 25.63 million bpd in March, according to the survey of oil firms, OPEC officials and analysts.
The survey suggests OPEC has made 84 percent of supply cutbacks promised since last year, one of its highest ever rates of adherence. But analysts say weak demand and rising stocks underline the scale of its task in boosting the market.
“OPEC has managed to cut its supply with a relatively high degree of compliance,” said Harry Tchilinguirian, oil analyst at BNP Paribas in London.
“Yet it faces a large inventory hurdle, both in volume and in days of demand cover. They will need to stay the course for longer compared to the recessionary periods of 1997-98 or 2001.”
Despite OPEC deals to cut supply by 4.2 million bpd since September as prices and demand slid because of the recession, oil stocks have swollen in developed countries and equalled 61.6 days of demand in February, the highest since 1993.
The pledged curbs are equal to about 5 percent of daily world demand. OPEC pumps more than a third of the world’s oil.
Supply from OPEC members with output limits, all except Iraq, in April was 680,000 bpd higher than their collective target of 24.84 million bpd, the survey found, meaning OPEC has lowered output by 3.52 million bpd of the promised 4.2 million.
That gives an 84 percent compliance rate, up from a revised 81 percent in March. OPEC’s historical average compliance rate is a much lower 60 percent, according to the International Energy Agency.
Oil prices climbed on Friday. U.S. crude was up $1.84 a barrel at $52.96 as of 1512 GMT.
NIGERIAN CURBS
The single largest reduction in April was from Nigeria, which produced less crude due to disruptions to oil facilities rather than voluntary cuts, the survey found.
Royal Dutch Shell’s (RDSa.L) Nigerian venture declared force majeure on exports of Bonny Light crude oil in April and May due to production shut down as a result of a pipeline fire.
Shell also has a force majeure on exports of the Forcados crude stream due after explosions on the trans-Escravos pipeline. Oil traders said some cargoes of Forcados due to load in April have been deferred to May.
OPEC’s Gulf producers remained the most compliant with their output targets. Saudi Arabia, OPEC’s top producer, kept output steady and below its OPEC target of 8.05 million bpd in April.
OPEC oil supply fell in April for an eighth consecutive month due to disruptions to Nigerian output and as members implemented a deal to prop up prices, a Reuters survey showed on Friday.
Supply from the 11 members of the Organization of the Petroleum Exporting Countries bound by output targets declined to 25.52 million barrels per day (bpd) from a revised 25.63 million bpd in March, according to the survey of oil firms, OPEC officials and analysts.
The survey suggests OPEC has made 84 percent of supply cutbacks promised since last year, one of its highest ever rates of adherence. But analysts say weak demand and rising stocks underline the scale of its task in boosting the market.
“OPEC has managed to cut its supply with a relatively high degree of compliance,” said Harry Tchilinguirian, oil analyst at BNP Paribas in London.
“Yet it faces a large inventory hurdle, both in volume and in days of demand cover. They will need to stay the course for longer compared to the recessionary periods of 1997-98 or 2001.”
Despite OPEC deals to cut supply by 4.2 million bpd since September as prices and demand slid because of the recession, oil stocks have swollen in developed countries and equalled 61.6 days of demand in February, the highest since 1993.
The pledged curbs are equal to about 5 percent of daily world demand. OPEC pumps more than a third of the world’s oil.
Supply from OPEC members with output limits, all except Iraq, in April was 680,000 bpd higher than their collective target of 24.84 million bpd, the survey found, meaning OPEC has lowered output by 3.52 million bpd of the promised 4.2 million.
That gives an 84 percent compliance rate, up from a revised 81 percent in March. OPEC’s historical average compliance rate is a much lower 60 percent, according to the International Energy Agency.
Oil prices climbed on Friday. U.S. crude was up $1.84 a barrel at $52.96 as of 1512 GMT.
NIGERIAN CURBS
The single largest reduction in April was from Nigeria, which produced less crude due to disruptions to oil facilities rather than voluntary cuts, the survey found.
Royal Dutch Shell’s (RDSa.L) Nigerian venture declared force majeure on exports of Bonny Light crude oil in April and May due to production shut down as a result of a pipeline fire.
Shell also has a force majeure on exports of the Forcados crude stream due after explosions on the trans-Escravos pipeline. Oil traders said some cargoes of Forcados due to load in April have been deferred to May.
OPEC’s Gulf producers remained the most compliant with their output targets. Saudi Arabia, OPEC’s top producer, kept output steady and below its OPEC target of 8.05 million bpd in April.
Elsewhere in the group, Libya and Algeria continued to trim output slightly in April.
The survey found little to suggest further cutbacks from Iran, the second-largest OPEC producer. It kept supply essentially flat in percentage terms in April, more than 300,000 bpd above its target.
Angola, holder of the OPEC presidency this year, has yet to reach its target of 1.52 million bpd and, according to trade sources, boosted its April export plan by one cargo.
Angolan exports in April totaled 1.65 million bpd, according to loading schedules. Preliminary programmes indicate further increases in May and June.
With Iraq’s production at 2.3 million bpd in April — up due to higher exports from the country’s south — all 12 OPEC members pumped 27.82 million bpd last month, down from 27.86 million bpd in March, the survey found.
Source: news.chemnet.com
