OPEC output surges to 24.92 MBPD in May: Survey

OPEC's overall output surged by 800,000 BPD to 24.92 million barrels per day (MBPD) in May as Iraq resumed exports after a one-month suspension and Venezuela apparently obeyed a government order to turn up the pumps, a Platts survey of OPEC and oil industry officials showed June 10.

Excluding Iraq, whose exports are controlled by the UN, the ten members with quotas pumped an average 23.13 MBPD over the month, an increase of 220,000 BPD over April's 22.91 MBPD which left them 1.43 MBPD in excess of their self-imposed 21.7 MBPD production ceiling.

All ten members with quotas overproduced them. Seven countries increased production month-on-month by a combined 870,000 BPD. This volume was partly offset by 70,000 BPD in output decreases by three countries.

Iraq accounted for the biggest single increase -- 580,000 BPD. Iraq turned off the taps in early April to protest Israeli incursions into Palestinian areas and turned them back on in early May. But Baghdad, with May output estimated at 1.79 MBPD, has not managed to restore its volumes anywhere near levels of 2.5-2.51 MBPD seen in February and March this year.

Traders say Iraq has cut its illegal surcharge on crude exports to 15 cents per barrels for all destinations from 25 cents per barrels for Europe and Asia and 30 cents per barrels for the US in an attempt to boost liftings, effective from the beginning of June.

Venezuela accounted for the second biggest volume boost in May, ramping up output to 2.68 MBPD from 2.48 MBPD in April when a strike crippled exports, the survey showed. Sources said in May that the energy ministry had ordered state oil company Petroleos de Venezuela temporarily to raise output above the country's OPEC quota to alleviate the government's serious cash flow problems. This was denied by oil minister Alvaro Silva.

"There seems little prospect of any supply squeezes in the coming months, given the return of Iraq and the need for Venezuela to increase output," commented John Kingston, Platts' global director of oil. "However, there will be broader concerns if OPEC does not significantly increase output at its September meeting, in order to replenish inventories and prepare for the winter months' increased demand."

OPEC's overall production in May of 24.92 MBPD is the highest level since March, when the group pumped an average 25.45 MBPD. But the 23.13 MBPD pumped by the ten members with quotas is the highest volume since the 21.7 MBPD production ceiling came into effect at the beginning of January.

OPEC ministers have sent strong signals that they do not intend to adjust quotas when they meet Jun 26 in Vienna, although the cartel's outgoing secretary-general Ali Rodriguez suggested in an interview with Platts last week that a production increase could be possible in the fourth quarter.

Country-by-country breakdown of production with figures in millions of

BPD

Country	May 02	April 02	March 02	Feb. 02	Jan. 02	Quota
Algeria	0.830	0.810	0.800	0.790	0.800	0.693
Indonesia	1.130	1.140	1.140	1.150	1.150	1.125
Iran	3.370	3.340	3.380	3.330	3.280	3.186
Iraq	1.790	1.210	2.510	2.500	2.260	N/A
Kuwait	1.880	1.870	1.850	1.840	1.850	1.741
Libya	1.310	1.300	1.290	1.280	1.270	1.162
Nigeria	1.900	1.950	1.970	1.960	2.000	1.787
Qatar	0.640	0.620	0.600	0.590	0.590	0.562
Saudi Arabia	7.430	7.430	7.370	7.240	7.300	7.053
UAE	1.960	1.970	1.960	1.950	1.950	1.894
Venezuela	2.680	2.480	2.580	2.560	2.560	2.497
Total	24.920	24.120	25.450	25.190	25.010
OPEC 10 (excluding IRAQ)	23.130	22.910	22.940	22.690	22.750	21.70

(Alex)