LONDON (Reuters) - OPEC oil supply is likely to fall in February as members enforce a deal to cut output, an industry consultant said on Monday, indicating one of the group’s highest ever rates of compliance.
OPEC’s 11 members with output targets, all except Iraq, are expected to pump 25.32 million barrels per day (bpd), down 980,000 bpd from 26.3 million bpd in January, Conrad Gerber of Petrologistics told Reuters.
The reduction indicates the prospect of a slide in oil revenues due to collapsing prices and demand has increased resolve within the Organization of the Petroleum Exporting Countries to meet pledged supply curbs.
“OPEC is doing very well indeed,” Gerber said. “They have really turned down the taps to start to soak up the surplus.”
Based on the Petrologistics estimate, the 11 members in February are pumping 480,000 bpd more than their collective supply target of 24.84 million bpd which took effect on January 1.
That indicates they have delivered on 3.72 million bpd of cutbacks totalling 4.2 million bpd, about 5 percent of daily world demand, promised since September.
According to a Reuters calculation, that gives a compliance rate of 89 percent, historically one of OPEC’s highest-ever levels of adherence to an agreement to limit supply.
Saudi Arabia, Iran, Angola, Kuwait and the United Arab Emirates were among the OPEC countries to lower output in February, Petrologistics said.
Oil was trading higher on Monday. U.S. crude (CLc1> was up 66 cents at $40.694 a barrel by 1250 GMT. It has collapsed from a record near $150 since last year.
Oil would have fallen to $20 without OPEC intervention but oil markets face tough times in 2009 amid the global financial crisis, Kuwait’s state news agency cited an oil official as saying on Monday.
“The decisions taken by OPEC in the past few months protected oil prices from a big decline,” Nawal al-Fuzaia, Kuwait’s national representative to OPEC told KUNA.
“If it has not been for these decisions, oil prices would have reached $20 a barrel.”
Top world oil exporter Saudi Arabia has led the OPEC cutbacks. It lowered supply to 7.9 million bpd, down from 8.05 million bpd in January and below its OPEC target of 8.05 million bpd, Petrologistics said.
Iran, OPEC’s second-largest producer behind Saudi Arabia, is lowering production in February but still exceeding its target. It is expected to pump 3.55 million bpd, down 300,000 bpd from January.
Angola, holder of the OPEC presidency this year, is also implementing more of its share of the reduction, lowering output to 1.65 million bpd in February. Its target is 1.52 million bpd.
Kuwait and the United Arab Emirates are likely to trim supply further in February to 2.26 million bpd and 2.25 million bpd, respectively.
With Iraq’s production at 2.28 million bpd in February, all 12 OPEC members are expected to pump 27.6 million bpd this month, down 1.1 million bpd from 28.7 million bpd in January.
Petrologistics measures OPEC supply, which excludes oil produced and placed in storage, by tracking oil tanker shipments and estimating domestic consumption. OPEC does not issue timely estimates of its own production.
The latest OPEC reduction of 2.2 million bpd, its largest ever single supply cut, took effect on January 1. It delivered on 67 percent of the promised curbs in January according to a Reuters survey.