April 30, 2010 - 3:15PM
The Organization of Petroleum Exporting Countries’ crude-oil production increased in April, led by a Saudi Arabian gain, a Bloomberg News survey showed.
Output rose 25,000 barrels, or 0.1 per cent, to an average 29.19 million barrels a day from a revised 29.165 million in March, according to the survey of oil companies, producers and analysts. Production by members with quotas, all except Iraq, rose 80,000 barrels to 26.88 million barrels a day, the highest level since December 2008 and 2.035 million above their target.
OPEC cut its quotas by 4.2 million barrels to 24.845 million barrels a day beginning in January 2009 as fuel demand fell during the worst recession since World War II. Compliance among the 11 members with quotas fell to 52 per cent in April from 53 per cent in March. All members with quotas exceeded their production limits.
''We’re unlikely to see OPEC discipline improve at all until prices drop, at which point it may be too late,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts.
Crude oil for June delivery rose $US1.95, or 2.3 per cent, to $US85.17 a barrel yesterday on the New York Mercantile Exchange, the highest settlement price since April 15. Futures have gained 67 per cent in the past year.
Saudi Arabia, the group’s biggest producer, bolstered output by 60,000 barrels to 8.26 million barrels a day, the highest level since December 2008. It was the largest increase of any member. The kingdom exceeded its quota by 209,000 barrels a day.
''The Saudis are probably concerned about the elevated price level,'' Lynch said. ''They tend to take a longer-term view than other members.''
Higher production
The United Arab Emirates, OPEC’s third-largest producer, bolstered output by 20,000 barrels to 2.32 million barrels a day, putting the country 97,000 barrels a day above its target. It was the second-biggest gain.
Iraqi output dropped 55,000 barrels a day to 2.31 million in April, the lowest level since October 2008. It was the biggest decrease in OPEC.
An explosion blew a hole in an Iraqi pipeline, stopping crude oil exports via Turkey on April 22. Oil exports were expected to resume within a week, once repairs are completed on the pipeline, an artery through which Iraq pumps one-fourth of its crude shipments, according to Imad Baqer, head of the production department at the North Oil Co.
Source: http://www.smh.com.au/business/markets/oil-output-increases-on-saudi-arabian-gain-20100430-twu9.html
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