Iran oil output up in November, says survey

TEHRAN,Dec.3(MNA)--Iran posted increases in its oil output in November, according to a Reuters survey. Iranian supply has risen by 40,000 b/d to 2.71m b/d, the survey found. A resumption in sales to South Korea in October has helped Iranian oil exports to increase, sources in the survey said. “There’s a lot of customers up for renewals of U.S. sanctions exemptions and these will probably be granted, although with lower volumes,” said an industry source. There was no sign of any substantial reduction in supply from Saudi Arabia and its Persian Gulf Arab allies, which have kept output high all year to keep oil prices in check during the reduction in Iranian exports. Saudi Arabia pumped 9.90m b/d in November, the survey found, down 50,000 b/d from October. Sources in the survey said Saudi crude exports in November were higher but domestic use for power generation was lower, resulting in little overall change. OPEC crude oil output has declined in November to its lowest since January because of disruptions to Nigerian output and reduced supplies from Angola and Libya, the Reuters survey found. Supply from the 12-member Organization of the Petroleum Exporting Countries has averaged 31.06m barrels per day (b/d), down from 31.15m b/d in October, the survey of sources at oil companies, OPEC officials and analysts found. OPEC meets next month to review output policy. The survey suggests the 12-member group is still producing over a million barrels per day more than its target of 30m b/d. But OPEC officials say any formal cut in output is unlikely with prices well above $100 a barrel. “The level of price is satisfactory for us,” said a delegate from one of OPEC’s African members. “We are producing a little bit more than the target but the market is absorbing this excess. So I think there will not be any change in the target.” November’s total is the lowest since January 2012 when the group produced 30.95m b/d, according to Reuters surveys. Output is down by about 700,000 b/d from its peak for the year of 31.75m b/d in April. Disruptions in Nigeria have weighed on OPEC supply this month. Nigerian exports were scheduled to rise above 2m b/d in November, but supply declined because of oil spills, flooding and theft. Exports of four Nigerian crude oil grades, including the largest stream, Exxon Mobil’s Qua Iboe, were under force majeure for all or part of November. The measure still applies to shipments of two of them, Qua and Eni’s Brass River. Lower exports from Angola and a drop in supply in Libya were the other main reasons for the decline in OPEC output. A strike at Libya’s Zawiya refinery briefly caused output at one field to be halted earlier in November and a protest prompted a second shutdown of the refinery this month. Meanwhile, oil prices are expected to fall slightly over the next year as high production feeds softening demand at a time of slowing global economic growth, a Reuters poll showed. Reuters’ monthly oil price survey of 29 analysts forecasts North Sea Brent crude oil will average $107.50 per barrel in 2013, down $1.30 from the forecast in the October poll and compared with an average of around $111.90 so far in 2012. Five analysts now expect Brent to average less than $100 in 2013, compared with three in last month’s poll. Only three analysts forecast Brent will average more than $115 next year, compared with five analysts last month. “We are notably bearish on the near term oil price environment given that we see a fundamental oversupply of oil,” said Raymond James analyst Praveen Narra, who has the lowest 2013 Brent price forecast of $80 per barrel in the poll. Gain Capital Group analyst Chris Tevere is also bearish: “Our overriding outlook continues to foresee slowing global growth (which) consequently should persist in undermining (oil)demand,” Tevere said. The Organization for Economic Cooperation and Development has cut its outlook for global growth, reducing its forecast for 2013 to 3.4 percent from 4.2 percent, saying the euro zone debt crisis was a serious threat to the world economy. Expectations of slowing growth have led many analysts to trim their oil price projections, although most institutions are less bearish than Narra at Raymond James. “Our analysis of supply and demand in 2013 suggests the oil market will be in comfortable surplus next year (barring an unforeseen disruption to supply) and thus we expect prices to fall back,” said Caroline Bain at the Economist Intelligence Unit. Iran says plans to raise crude oil production Iran's oil minister has said the country plans to increase its oil production capacity to up to 5.2 million barrels per day by early 2016. A Sunday report by state TV quotes Rostam Qasemi as saying this requires some $300 billion investment in the oil industry. He says current capacity is about four million barrels per day.