Venezuela, Saudi Oil Output Slumps, Says OPEC

Irving Hamilton
April 11, 2019

Global oil supply dropped in March as USA sanctions and power outages pushed Venezuela's crude output to a long-term low of 870,000 barrels per day (bpd), the International Energy Agency said on Thursday, even lower than OPEC reported the day before.

Current oil demand stands at around 100 million bpd.

According to secondary sources, Nigeria recorded 1.73mb/d, while S&P Global Platts survey puts the nation's output at 1.84mbpd from 1.88million b/d in February.The reported output is about 0.5mbpd lower than Federal Government key's assumptions and micro-framework for the 2019 budget based on a projection of 2.3mbpd oil production, oil price benchmark of $60pb and exchange rate of N305 to a dollar.

Venezuela reported a production figure of 960,000 b/d, down by a massive 472,000 b/d, as power outages and US sanctions cripple the South American oil producer.Saudi Arabia's crude output fell 289,000 b/d in March, to average 9.79 million b/d, according to an average of the six secondary sources that OPEC uses to gauge production.

Yet despite generally bullish oil markets, concerns that an economic slowdown this year will hit fuel consumption have been preventing crude prices from rising even higher, traders said.

An OPEC monthly report released on Wednesday showed that Venezuela's oil output sank last month to a long-term low below 1 million barrels per day (bpd), due to US sanctions and blackouts.

"We expect the drivers of this deficit to persist through 2Q19" due to a "shock and awe implementation of the OPEC cuts, further tightening of USA oil sanctions and an only moderate increase in shale production for now", the U.S. bank said in a note.

New Andhra Pradesh set for its first elections
Naidu's son Nara Lokesh is making his electoral debut, contesting for Assembly from Mangalagiri in capital region of Amaravati. Voting is taking place for 91 Parliamentary constituencies spread over 18 states and two union territories in this phase.

OPEC revised demand growth down in 2019 to 1.21 million bpd due to "slower-than-expected economic activity". OPEC and Russian Federation moved in to compensate for what was expected to be a significant loss of Iranian oil supply.

OPEC estimates that it needs to provide an average of 30.30 million bpd in 2019 to balance the market, a figure lowered by 160,000 bpd month-on-month partly due to weaker demand.

Despite the host of price drivers, there remain factors that could bring oil down later this year.

The UAE now produces around 3 million bpd under the OPEC+ reduction agreement.

OPEC does not release its own production data.

Russian Federation agreed to cut its production by 228,000 bpd but has struggled to comply with the pact.

Global refining throughput fell by 2.5 million bpd in March on unplanned outages, especially in the United States.

Other reports by

Discuss This Article