OPEC output up 150,000 barrels per day in July: Survey

OPEC crude production rose by 150,000 barrels per day in July to average 30.25 million barrels per day (mmbpd) over the month, a Platts survey of OPEC and oil industry officials reported Tuesday.

Iraq, whose exports were boosted by some liftings from Ceyhan, accounted for most of the increase, with production rising to 1.96-mmbpd in July from 1.85-mmbpd in June.

Excluding Iraq, which does not participate in OPEC's output distribution system, the ten members with quotas pumped an average 28.29-mmbpd, up a net 40,000 bpd from June's 28.25-mmbpd.

Increases totalling 170,000 bpd--110,000 bpd from Iraq, 10,000 bpd each from Algeria and Iran, and 20,000 bpd each from Libya and the UAE -- were partially offset by output declines totalling 20,000 bpd in Indonesia and Venezuela.

Saudi Arabia, the only OPEC member with any significant volume of surplus capacity, maintained its production at 9.5-mmbpd and has already signalled that it will keep output at this level through August.

"Crude prices are now holding well above $60 and it is not even autumn let alone winter," said John Kingston, global director of oil at Platts. "What, if anything, does OPEC have up its sleeve? Rank-and-file members are coming up with a few extra barrels here and there, so if OPEC is going to pump any sizeable volume of extra oil, it is going to have to come from Saudi Arabia."

Recent analyses of OPEC production show only small volume increases from rank-and-file members alongside decreasing production from Indonesia and Venezuela.

It is also worth noting that while OPEC has encouraged its members to overproduce their quotas, three countries are currently producing within their official limits.

Indonesia's capacity is declining and has yet to reap any benefit from three new fields on which Jakarta has been pinning its hopes of a production boost. Venezuelan production has failed to recover from the two-month oil strike that crippled the country's oil sector in the winter of 2002-2003. These two countries have been under-producing their quotas by several hundred thousand barrels a day each for some time but have continued to receive quota increases based on their theoretical share of OPEC output.

Iran, OPEC's second biggest producer behind Saudi Arabia, now appears to have pushed its production close to its limit, believed by some analysts to be little more than 4-mmbpd for the time being. Tehran's quota is 4.11-mmbpd.

Although OPEC insists that crude markets are adequately supplied and that refining capacity constraints are one of the main problems facing the oil industry, record-high prices of more than $64/bbl for US light crude futures and more than $63/bbl for North Sea Brent look set to keep up the pressure on the oil cartel to pump as much as it can.

Saudi Arabia says it is ready to produce its full 11-mmbpd of crude production capacity if customers ask for extra oil beyond the 9.5-mmbpd the kingdom is currently producing, but insists that that there is no demand for the additional barrels, the bulk of which are heavy and sour. (*)

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

Country	July 05	June 05	May 05	Apr 05	Mar 05	Feb 05	July 01 Quota
Algeria	1.340	1.330	1.310	1.300	1.300	1.290	0.894
Indonesia	0.940	0.950	0.950	0.950	0.950	0.960	1.451
Iran	4.000	3.990	3.980	3.950	3.980	3.930	4.110
Iraq	1.960	1.850	1.820	1.860	1.850	1.850	N/A
Kuwait	2.550	2.550	2.500	2.550	2.450	2.430	2.247
Libya	1.650	1.630	1.630	1.620	1.620	1.610	1.500
Nigeria	2.450	2.450	2.400	2.370	2.350	2.350	2.306
Qatar	0.780	0.780	0.780	0.780	0.780	0.780	0.726
Saudi Arabia	9.500	9.500	9.550	9.500	9.400	9.250	9.099
UAE	2.450	2.430	2.400	2.450	2.450	2.450	2.444
Venezuela	2.630	2.640	2.650	2.680	2.700	2.680	3.223
Total	30.250	30.100	30.020	29.960	29.830	29.580	N/A
OPEC 10 (excluding Iraq)	28.290	28.250	28.200	28.100	27.980	27.730	28.000