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Opec Output to Fall in First quarter: EIA

In its short-term energy outlook, the EIA said Opec production will fall from 31.4 million bbl/d in September 2008 to 29.3 million bbl/d by March this year.

“Opec crude oil production is expected to average 30 million bbl/d in 2009 and 30.7 million bbl/d in 2010.”

The EIA further said that Opec production of non-crude liquids would rise substantially next year, growing by 600,000 bbl/d in 2009 and by 850,000 bbl/d in 2010.

The combination of lower demand for Opec crude oil and the capacity expansions expected in several Opec countries means that surplus production capacity could increase to roughly 4.0 million bbl/d in 2009 and 4.7 million bbl/d by the end of 2010, compared with the 1 to 2 million bbl/d of surplus capacity available over the past several years.

The EIA also expects that the West Texas Intermediate (WTI) oil prices will average $43 per barrel in 2009 and $55 in 2010.

In a consensus forecast, 32 oil analysts in a Reuter’s survey last week saw average price of $56 a barrel for the year 2009, down by nearly half from last year’s average.

The monthly average price of West Texas Intermediate crude oil has fallen from $133 per barrel in July to $41 in December. “The oil price will be driven by the depth and duration of the global economic downturn, the pace and timing of the recovery, and actual Opec production,” the IEA said. Total world oil consumption is expected to record a modest rebound in 2010, rising by 880,000 bbl/d from year-earlier levels, on the assumption of the beginning of an expected recovery in global economic growth.

“Oil consumption growth is concentrated in China, the Middle East, and Latin America,” the agency said.

haseebhaider@khaleejtimes.com