OPEC Quota Compliance Dips

The Organization of Petroleum Exporting Countries’ compliance with output quotas agreed in 2008 slipped last month after Saudi Arabia and Nigeria raised crude oil production. Output from the 11 members bound by quotas climbed to 26.861 million bpd in July, the group’s Vienna based secretariat said in a monthly report today. That implies compliance of 52% last month compared with a revised 55% for June.

OPEC, responsible for about 40% of global crude supply, announced a record production curb in December 2008 in response to collapsing global demand. The group’s commitment to a 4.2 million bpd cut to 24.845 million has dropped by almost half as oil prices rebounded.

The producer group is likely to maintain current output levels when it next meets on 14 October 2010 because oil prices are still at a satisfactory level, Angola Oil Minister Jose Maria Botelho de Vasconcelos said yesterday. While the oil market may see “sudden changes, sentiments and signs within OPEC are to keep things as they are,” Vasconcelos said in Luanda. Angola’s output fell in July to 1.77 million bpd, according to the report.

Iraq, which is exempt from the quota system, cut production. Output including Iraq averaged 29.197 million barrels a day last month, an increase of 121,800 bpd, according to the report. OPEC’s 12 members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the UAE and Venezuela. - Arabian Business