The Organisation of Petroleum Exporting Countries will produce 28.5 million barrels a day this month, up 500,000 barrels from April, said Conrad Gerber, head of the Geneva-based company. The 10 OPEC countries that agree to limit supply are pumping 2.85 million barrels a day above their target, the figures show.
Saudi Arabia, OPEC’s largest producer, is boosting output in a bid to lower oil prices that reached a record $41.85 on May 17 in New York and after calls from the US and other consumers for more oil. The group’s production in May is set to be the highest since November, 2000.
“Production will be even higher in June,” said Steve Turner, an oil analyst at Commerzbank Securities in London. “Perhaps the frightening thing is that it hasn’t been enough to cool down the market.” OPEC, excluding Iraq, will produce about 26.35 million barrels a day this month, said Gerber, who assesses production by tracking tanker shipments. That’s 650,000 barrels a day higher than a revised April estimate of 25.7 million barrels a day.
Production is rising because Saudi Arabia will probably boost output by 300,000 barrels a day to 8.6 million barrels a day, and as the United Arab Emirates supplies more oil after some maintenance work was carried out, he said.
Iraqi Production Crude oil in New York was up 2 cents at $41.16 a barrel in electronic trading on the New York Mercantile Exchange.
Prices have rallied 27% this year because of faster-than-expected growth in demand, a lack of oil-refinery capacity in the US and concern of disruption to crude supplies in the Middle East.
Iraq, the only OPEC member without a quota, is likely to produce 2.15 million barrels a day this month, down 150,000 a day from April, Gerber said. Exports during the month were lowered for about a week after a sabotage attack on a pipeline linking its southern fields to export terminals in the Persian Gulf.