Good post, but I'd draw your attention to where the OPEC excess production is coming from, and you can quickly see that the "extra supply" has been from even more suspect sources than SA. I refer you these two RJ industry briefs dated 9/13
beacon1.rjf.com
and 10/15.
beacon1.rjf.com
The first gives "estimated capacity", and the second gives "October production", and all by country. November's will be out next week.
Algeria est cap: 1,220 October actual 1,290
Iran 3,900 3,960
Iraq (*) 2,050 2,250
Kuwait 2,400 2,470
Libya (**) 1,450 1,630
Nigeria (***) 2,400 2,400
SA 10,000 9,600
UAE 2,500 2,480
Venz 2,150 2,272
My thesis is that a number of these OPEC countries are exceeding their true sustainable capacity. Excluding SA, I count 682,000 bpd so in October. In many cases there is the question of whether they can even maintain their total capacity let alone sustain it. They do this in the short run by engaging in techniques like water injection, or forced pumping. This is like eating your young, and results in damage to fields. At over $50 oil, I guess these bozos thought it was just expedient to do this? The question though is will they continue to jeopardize fields at these low 40's prices (actually even less as $42 is the West Texas price)? Probably not, and maybe the fields themselves will soon render the verdict. Therefore I don't see this as an OPEC MoP "output" pronouncement one way or the other, that's a non sequitur.
(*)Iraq: at war what more to say?
(**) Libya: Is this one for real, as they have apparently been investing in new real output?
(***) Nigeria:
beacon1.rjf.com |
