According to a Reuters survey, Iran posted increases in its oil output in November. Iranian supply has risen by 40,000 barrels per day to 2.71 million barrels per day.
Sources in the survey said that a resumption in sales to South Korea in October has helped Iranian oil exports to increase. There's a lot of customers up for renewals of US sanctions exemptions and these will probably be granted although with lower volumes.
An industry source said that there was no sign of any substantial reduction in supply from Saudi Arabia and its Persian Gulf Arab allies, which have kept output high all year to keep oil prices in check during the reduction in Iranian exports. Saudi Arabia pumped 9.90 million barrels per day in November down 50,000 barrels per day from October.
Sources in the survey said that Saudi crude exports in November were higher but domestic use for power generation was lower resulting in little overall change. OPEC crude oil output has declined in November to its lowest since January because of disruptions to Nigerian output and reduced supplies from Angola and Libya.
Supply from the 12 member Organization of the Petroleum Exporting Countries has averaged 31.06 million barrels per day down from 31.15 million barrels per day in October.
OPEC meets next month to review output policy. The survey suggests the 12 member group is still producing over a million barrels per day more than its target of 30 million barrels day. But any formal cut in output is unlikely with prices well above USD 100 per barrel.
A delegate from one of OPEC's African members said that the level of price is satisfactory for us. We are producing a little bit more than the target but the market is absorbing this excess. So I think there will not be any change in the target.
According to Reuters surveys, November's total is the lowest since January 2012 when the group produced 30.95 million barrels per day. Output is down by about 700,000 barrels per day from its peak for the year of 31.75 million barrels per day in April. Disruptions in Nigeria have weighed on OPEC supply this month. Nigerian exports were scheduled to rise above 2 million barrels per day in November but supply declined because of oil spills, flooding and theft.
Exports of four Nigerian crude oil grades including the largest stream, Exxon Mobil's Qua Iboe were under force majeure for all or part of November. The measure still applies to shipments of two of them, Qua and Eni's Brass River.
Lower exports from Angola and a drop in supply in Libya were the other main reasons for the decline in OPEC output. A strike at Libya's Zawiya refinery briefly caused output at one field to be halted earlier in November and a protest prompted a second shutdown of the refinery this month. Meanwhile, oil prices are expected to fall slightly over the next year as high production feeds softening demand at a time of slowing global economic growth.
Reuters' monthly oil price survey of 29 analysts forecasts North Sea Brent crude oil will average USD 107.50 per barrel in 2013 down USD 1.30 from the forecast in the October poll and compared with an average of around USD 111.90 so far in 2012.
Five analysts now expect Brent to average less than USD 100 in 2013 compared with three in last month's poll. Only three analysts forecast Brent will average more than USD 115 next year compared with five analysts last month.
Mr Raymond James analyst Praveen Narra who has the lowest 2013 Brent price forecast of USD 80 per barrel in the poll said that "We are notably bearish on the near term oil price environment given that we see a fundamental oversupply of oil."
