OPEC’s compliance with record supply cuts rose in February as violent clashes in Libya cut the country’s oil production, the International Energy Agency said.
The producer group’s 11 members bound by quotas pumped 27.37 million barrels a day last month, implying compliance of 40 percent, the Paris-based IEA said today in its monthly report. That’s up from a two-year low in January of 37 percent.
Supply from all 12 nations of the Organization of Petroleum Exporting countries, including Iraq, decreased by about 90,000 barrels a day to 30.05 million barrels, the IEA said. Production declined in Libya, Angola, Nigeria and Venezuela.
“Output in February was down marginally in the wake of civil unrest in Libya and the shut-in of around two thirds of the country’s oil production by early March,” the IEA said.
Other OPEC members, including Saudi Arabia, boosted output to offset lost Libyan production, the agency said. “With Libya now effectively in a state of full-scale civil war and production down to a trickle, other OPEC countries may need to further ramp up production in the weeks and months ahead to offset lost output of 1.5 to 1.6 million barrels a day,” the IEA said.
OPEC, responsible for about 40 percent of world crude supply, announced its biggest-ever supply cuts in late 2008 as global demand collapsed. The decision set a cap at 24.845 million barrels a day for 11 of its members. Adherence to the reduction eased last year and in 2009 as prices rebounded.
The compliance percentages are calculated based on the 11 nations targeting a 4.2 million barrel-a-day reduction from a base production rate of 29.045 million barrels a day in September 2008.
Saudi Arabia, OPEC’s largest producer, pumped 8.9 million barrels a day in February, up 100,000 barrels a day from January, the IEA estimated.
Iraq’s daily output grew to 2.68 million barrels a day last month, the highest in more than two decades.
OPEC’s 12 members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Iraq is exempt from the quota system.