Tuesday, February 7, 2023
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OPEC Misses Production Quota By 310,000 Bpd

A new study from Argus on Friday showed that OPEC+ production fell to 38.29 million barrels per day last month — 1.81 million barrels per day less than the reduced quota.

The 19 OPEC+ members under the quota produced 310,000 barrels per day less in November than the previous month. But that is still 1.81 million barrels per day less than the November quota. The November quota was a cut of 2 million barrels per day from October levels, although it was believed at the time that the group might not be able to meet even that reduced target.

Non-OPEC members of the OPEC+ group outperformed traditional OPEC members, increasing combined production by 460,000 barrels per day, an eight-month record, according to Argus. Most of those increases came from Kazakhstan, where production increased by 330,000 barrels per day, and Russian production, which saw an increase of 190,000 barrels per day after the restart of Sakhalin 1.

OPEC crude production fell by 770,000 barrels per day in November, the lowest point in six months. The production declines were led by Saudi Arabia, which saw its production decrease by 440,000 barrels per day.

The biggest laggards among the broader OPEC+ group are now Russia, according to Argus, with production 670,000 b/d below target; Nigeria, producing 530,000 b/d below target, Angola, producing 350,000 b/d below target, and Malaysia, producing 170,000 b/d below target.

The members of the group that met or exceeded their production target are Oman, Kazakhstan, Bahrain, Iraq, Kuwait, United Arab Emirates, Algeria and Gabon.

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Overall, non-OPEC members underproduced 92,000 barrels per day, while OPEC members underproduced some of the quota by 90,000 barrels per day.

The price of crude oil has fallen significantly this week, leading some to predict that the OPEC+ group may cut oil production to support crude oil prices. Brent crude is expected to end the week more than $10 below this time last week – well below what most analysts suspect is the OPEC price protection trigger.

By Julianne Geiger

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