OPEC Oil Output Boost in September Limited by Iran Losses

OILMONSTER.COM- OPEC delivered only a limited increase in oil production in September, a Reuters survey has found, as a cut in Iranian shipments due to U.S. sanctions offset higher output in Libya, Saudi Arabia and Angola.

The 15-member Organization of the Petroleum Exporting Countries pumped 32.85 million barrels per day in September, the survey on Monday found, up 90,000 bpd from August's revised level and the highest this year.

But the 12 OPEC members bound by a supply-limiting agreement actually cut output by 70,000 bpd because of declines in Iran and Venezuela, boosting compliance with supply targets to 128 percent from a revised 122 percent in August, the survey found.

Oil prices have extended a rally this year on expectations the sanctions on Iran will test OPEC's ability to replace the shortfall, despite the group agreeing in June to pump more after pressure from U.S. President Donald Trump. Oil on Monday reached $83.32 a barrel, the highest since 2014.

"The supply situation looks fragile indeed, as any additional shortfall such as a deterioration of the situation in Venezuela would tighten oil supplies," said Norbert Rücker at Julius Baer.

OPEC's June agreement involved OPEC, Russia and other non-members returning to 100 percent compliance with oil output cuts that began in January 2017, after months of underproduction in Venezuela and elsewhere pushed adherence above 160 percent.

While Saudi Arabia has now almost fully reversed its pledged supply cut of 486,000 bpd, this has not fully offset losses in Iran and declining output in Venezuela and Angola.

Courtesy: www.businessinsider.com