LONDON, Dec 11, (AFP): OPEC meets in Vienna this week to decide on whether to change the cartel’s oil production levels in the face of heightened Iran tensions, higher Libyan output and a weak economic outlook.
The Organization of Petroleum Exporting Countries, which supplies one third of the world’s crude, is Wednesday set to maintain its official output target of 24.84 million barrels per day — where it has stood for almost two years.
But with the International Energy Agency estimating that actual OPEC production, excluding Iraq, stood at 27.32 mbpd in October, the organization may decide to issue a statement promising stricter compliance to its quotas.
The Vienna-based cartel meets periodically to set production levels, hoping that its decisions result in favourable market oil prices for its dozen members, which include current OPEC president Iran, oil kingpin Saudi Arabia, Libya, Nigeria and Venezuela.

Satisfactory
OPEC Secretary General Abdullah El-Badri last week said that current oil prices of around $100 a barrel were “satisfactory,” adding that crude supply was adequate — indicating that its official output ceiling would stay on hold.
On Friday, Brent North Sea crude was trading at $107.79 a barrel, while New York’s light sweet stood at $98.11.
Despite economic turbulence and a pick up in Libya oil output after recent war ravaged its production, crude futures have managed to remain at relatively high levels thanks to geopolitical unrest across the oil-rich Middle East.
All eyes at Wednesday’s gathering will be on Iran, OPEC’s second-biggest oil producer after Saudi Arabia, and whose oil sector is at threat from potential EU sanctions over the Islamic republic’s controversial nuclear programme.
EU foreign ministers have slapped sanctions on an extra 143 firms and 37 individuals in Iran, after the publication last month of a report on the country’s nuclear sector by the International Atomic Energy Agency (IAEA).

The ministers also threatened to “extend the scope” of punitive action to strike at Tehran’s economic heart, saying the EU would examine measures targeting the financial system, energy and transport sectors by late January.
“Assessing the fallout from the Iranian sanctions, OPEC meets with a complex economic, fundamental and political backdrop,” said Barclays Capital analyst Sudakshina Unnikrishnan.
“The geopolitical context has deepened” since OPEC’s last meeting in June, she added. Iran and Venezuela are seen as OPEC’s traditional hawks, regularly calling on the cartel to cut production to boost oil prices and consequently their revenues.
But last week, Venezuelan President Hugo Chavez said current prices were at a “fair” level.
“The talk in town is that the price hawks are not minded to rock the boat and current production levels will continue through next year,” said David Hufton, an oil analyst at brokers PVM.
OPEC, which meets Wednesday to decide on oil output levels, has had an official production target of 24.84 million barrels per day (mbpd) since January 2009.

Excluding Iraq, which is not part of OPEC’s quota system due to the country’s unrest, the cartel is pumping almost ten percent above the limit.
The International Energy Agency estimated that actual OPEC production, excluding Iraq, stood at 27.32 mbpd in October, or 2.48 mbpd more than the cartel’s official target.
Taking into account overproduction and output by Iraq, the Organization of Petroleum Exporting Countries’ dozen members are supplying 34 percent of the world’s crude oil.
Here is a list of current OPEC quotas and the most recent IEA estimates for October.

OPEC member Official OPEC quota IEA estimate (mbpd) (mbpd)
Algeria 1.20 1.29
Angola 1.52 1.72
Ecuador 0.43 0.50
Iran 3.34 3.53
Kuwait 2.22 2.65
Libya 1.47 0.35
Nigeria 1.67 2.02
Qatar 0.73 0.81
Saudi Arabia 8.05 9.45
UAE 2.22 2.51
Venezuela 1.99 2.49
Total excluding Iraq 24.84 27.32
Total including Iraq n/a 30.01