OPEC production decreases by 53,000bpd

Nigeria’s output increases by 44,400bpd

THE Organization of Petroleum Exporting Countries (OPEC) produced 30.15 million barrels per day in January, representing a decrease of 53,000 bpd from the previous month.

  These declines were mainly due to Iraq and Libya, with Angola, Saudi Arabia, Kuwait and the United Arab Emirates all increasing supply.

  Interestingly, Nigeria recorded an increase in crude oil production from 1.896 mbpd it produced in December to 1.940 mbpd, representing an increase of 44,400 bpd in the month under review, according to secondary sources.

  The cartel lowered its estimate for non-OPEC supply growth by about 400,000 barrels a day, led by a reduction of 130,000 a day in the U.S. Estimates for Colombia, Canada and Yemen were also trimmed. 

  Global oil demand is expected to increase by 1.17 million barrels a day, or 1.3 percent, in 2015 to 92.32 million barrels a day, according to the report.

  It stated: “As prices drop, oil requirements are likely to respond positively, although this can be impacted by other factors. For example, in 2008, prices fell sharply starting in the summer with the onset of the financial crisis and the global economic recession, which also led to a deterioration in demand. This time the sharp fall in prices has been mainly driven by excess supply. As a result, lower prices are likely to help to accelerate the pace of oil demand growth this time”.

  The group also said that US shale oil production had fallen amid signs that its decision to allow the price of crude to decline sharply over the last quarter was beginning to put pressure on high-cost producers.

  US onshore drilling activity in parts of both emerging and mature oil production regions declined by 288 rigs from a peak of 1,551 in early October to 1,263 rigs in January, because of unattractive economic returns, OPEC said.

  The report said: “As prices drop, oil requirements are likely to respond positively, although this can be impacted by other factors.

For example, in 2008, prices fell sharply starting in the summer with the onset of the financial crisis and the global economic recession, which also led to deterioration in demand.

  “This time the sharp fall in prices has been mainly driven by excess supply. As a result, lower prices are likely to help to accelerate the pace of oil demand growth this time.

  OPEC natural gas liquids (NGLs) and non-conventional oils were estimated to average 5.83 mbpd in 2014, representing growth of 0.18 mbpd over the previous year. In 2015, OPEC NGLs and non-conventional oil are projected to average 6.03 mbpd, an increase of 0.20 mb/d over the previous year. Compared with the last month report, there are no changes in the 2014 estimation or in the 2015 forecast for OPEC NGLs and non- conventional production.