What the outcome of the
OPEC Conference on 14th June will be is anybody’s guess….
OPEC's 12 member countries
exceeded their quota by 1.9 Mn b/d in April, according to the International
Energy Agency.
In contrast, Iran’s
oil exports have fallen by an estimated 40 percent since the start of the year according
to an IEA report of 13th June. Preliminary indications suggested
exports fell to 1.5 Mn b/d in April-May from 2.5 Mn b/d at the end of
2011. It is believed that Iran is still producing 3.3 Mn b/d,
down from 3.5 Mn b/d last year and stockpiling unsold oil. But, “In months
ahead, Iran may need to shut in production volumes if export markets remain
similarly constrained and storage fills up,” added the IEA.
In face of this situation,
Venezuela’s Oil Minister Rafael Ramirez declared “We are going to make a
very strong call in the meeting to the countries that are over-producing to cut
production”.
Saudi Arabia for its part
has lifted output to 10 Mn b/d, its highest in decades, to help nurse sickly
global economic growth in what Saudi Oil Minister Ali al-Naimi has called a
“type of stimulus” for the economy. That has taken supply from OPEC to 31.6 Mn
b/d in May, an OPEC report estimated on 12th June, well above the
official 30 Mn b/d target it set in December.
In addition, Al-Naimi responded
to questions from reporters in Vienna, after the Gulf Oil Review published a
report quoting him as saying in a June 2nd/3rd interview
that OPEC might need to enlarge its collective production ceiling of 30 million
barrels a day. “I didn't say it that way, I said maybe, be careful” he told
reporters upon arriving at his hotel yesterday evening. “Maybe more, maybe it can
be anything, it can be less”.
Mazhar
Al-Shereidah.
