OPEC Production Steady In January As Venezuela Output Plunges

February 13, 2018

OPEC’s total crude oil production averaged 32.30 million bpd in January, down by 8,100 bpd from December, as rising production in Iraq, Saudi Arabia, and Libya did not fully offset another massive plunge in Venezuela’s production and a small decline in Angola.

According to OPEC’s Monthly Oil Market Report published on Monday, secondary sources—the ones the cartel uses to monitor compliance and official stats—pegged Venezuela’s crude oil production in January 2018 at 1.600 million bpd, down by 47,300 bpd compared to December 2017. This was the largest monthly decline in oil production among OPEC’s 14 member states. Venezuela, allowed to pump as much as 1.972 million bpd under the deal, surely did not make that cut voluntarily—its economy is collapsing and oil production has been in freefall for months now.

OPEC’s secondary sources’ estimate is lower than last week’s survey by one of those sources—S&P Global Platts—which had estimated that Venezuela’s production dropped to 1.64 million bpd in January.

Venezuela, for its part, self-reported to OPEC that its oil production last month increased by 148,300 bpd over December to 1.769 million bpd.

Among the OPEC members that raised their production, Iraq was the leader with an increase of 30,200 bpd in January over December, to 4.435 million bpd, according to OPEC’s secondary sources. This is, yet again, higher than Iraq’s quota under the deal—4.351 million bpd—showing another month in which OPEC’s second-largest producer is either unwilling or unable to comply with the cuts.

OPEC’s leading producer Saudi Arabia lifted its January production by 23,300 bpd to 9.977 million bpd—but still below its 10.058-million-bpd quota, overcomplying once again.

The third-largest increase among OPEC nations last month came from Libya, whose production rose by 21,000 bpd to 978,000 bpd. Libya and Nigeria—which now have a combined cap of 2.8 million bpd to contribute to the deal after being exempt last year—together were just shy of that ceiling as Nigeria’s production was 1.819 million bpd, according to OPEC’s secondary sources.

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