A survey has revealed that oil output by the Organization of Petroleum Exporting Countries (OPEC) rose in February led by a further recovery in Nigerian supply by as much as 100,000 additional barrels per day.
According to the survey, OPEC’s Gulf producers Saudi Arabia, Kuwait and the United Arab Emirates maintained high compliance with their targets under the OPEC+ agreement.
Nigerian output posted OPEC’s biggest increase of 100,000 bpd in February, the survey found, bringing the country closer to a target to lift output to 1.6 million bpd this quarter.
Nigeria had recently begun to curb the massive oil thefts through the collaboration of security forces, community groups and the government agencies in the sector.
The oil cartel pumped 28.97 million barrels per day (bpd) in the month under review, the survey found, up 150,000 bpd from January. However, OPEC output is still down more than 700,000 bpd from September.
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This is despite strong adherence by top producers to an agreement by the wider OPEC+ alliance to cut production to support the market during this period.
The second-biggest increase came from number two OPEC producer, Iraq, which according to Refinitiv Eikon data and other companies that track the flows, has boosted southern exports this month.
The increase from the south outweighed a drop in northern exports via the Turkish port of Ceyhan, which were briefly disrupted by the earthquake that struck Turkey and Syria, Reuters stated.
In the last couple of years, Nigeria has been unable to meet its OPEC production quota and has therefore failed to take advantage of high International oil prices.
Two bodies While the Nigerian National Petroleum Company Limited (NNPC) has said that current production is over 1.6 million bpd, in January, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) put the figure at over 1.25 million bpd.
Many crude streams exported more in February, the survey found, although Africa’s top producer is still pumping much less than its OPEC target.
OPEC and its allies, known as OPEC+, had been boosting output for most of 2022 as demand recovered from the pandemic. But for November, with oil prices weakening, the group made its largest cut since the early days of COVID-19 in 2020.
It decided to cut the OPEC+ output target by 2 million bpd, of which about 1.27 million bpd was to come from the 10 participating OPEC countries. The target remained in place for February.
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With the rebound in Nigerian output in February, compliance with the agreement increased to 169% of pledged cuts, according to the survey, against 172 per cent in January.
But output is significantly undershooting targeted amounts because many producers – notably Nigeria and Angola – lack the capacity to pump at the agreed levels.
The 10 OPEC members required to cut production pumped about 880,000 bpd below the group’s target, the survey found. The shortfall in January was about 920,000 bpd.
Among countries with lower output, the largest drop of 80,000 bpd was in Angola due to a relatively small export programme in February and field maintenance on the Dalia stream.
Libya, Iran and Venezuela are the three producers exempt from OPEC cuts. Iran posted higher exports in February and Venezuelan output has increased slightly, according to the survey. Libyan output was also steady.
The survey aims to track supply to the market. It is based on shipping data provided by external sources, Refinitiv Eikon flows data, information from companies that track flows, such as Petro-Logistics and Kpler, and information provided by sources.
By Ken Okoye
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