Friday, Jun 15, 2012
(Adds more detailed comment throughout, OPEC data)
By James Herron
VIENNA--All members of the Organization of Petroleum Exporting Countries have agreed to abide by the 30 million barrel a day oil production ceiling, with all but two members aiming to reduce their output in line with the level in November 2011, said Secretary General Abdalla Salem el-Badri Friday.
"It's not really a quota," Mr. el-Badri told reporters at a briefing in Vienna. It is a looser production allocation for each member, but will result in compliance with the agreed output ceiling and the removal of a surplus of around 1.6 million barrels a day of oil from the market, he said.
These cuts will probably begin some time in July, and OPEC will monitor on a monthly basis whether countries are supplying oil in accordance with their production allocations, Mr. El-Badri said.
"Every country has its number and they can watch it," he said.
Libya will not be required to adhere to its November production, because at that time its output was still recovering from the shutdown during the war, he said. Iraq is still not subject to any individual quota, he said.
It was unclear how these two exemptions correlate with the collective 30 million barrel a day ceiling, because the production of Libya and Iraq has increased substantially since then.
By May Libya's output was 889,000 barrels a day more than in November and Iraq's had risen by 266,000 barrels a day over the same period, according to OPEC estimates based on secondary sources.
If other OPEC members were to return to their November production of 27.402 million barrels a day, and Iraq and Libya maintain their May output levels, OPEC's total production would be 31.806 million barrels a day, according to OPEC data.
This is 224,000 barrels a day above the group's production in May, according to OPEC's most recent monthly report.
The press briefing ended before Mr. El-Badri was asked to clarify this.
Write to James Herron at firstname.lastname@example.org
(END) Dow Jones Newswires