OPEC+ Data Deck (February 2024)
OPEC+ production fell 240 kbpd m/m in January, less than half the incremental 500 kbpd Q1 cut commitment; OPEC+ now overproducing its collective quota for the first time since 2020.
Below the paywall you will find the latest edition of the Commodity Context OPEC+ Data Deck (34-page PDF), covering official production estimates, quotas, compliance, and exports.
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Summary
Quota participating OPEC+ crude production fell 240 kbpd m/m in January to 34.46 MMbpd as the latest OPEC+ cut came into effect, with the largest declines coming from Kuwait (-110 kbpd), Iraq (-100 kbpd), and Algeria (-50 kbpd), each of which pledged to voluntarily cut production to further support the market.
However, this was less than half of the ~500 kbpd first quarter incremental cut commitment made by Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman in late-2023 (total ~700 kbpd less the 200 kbpd bump to the UAE’ baseline); each of these members is now technically producing above their latest agreed upon quota, with Kazakh production actually rising ~20 kbpd on the month.
January is the first month since 2020 that OPEC+ overproduced its quota (at least officially), to the tune of ~140 kbpd, after the producer group adjusted out-of-date baselines (which shrank underproduction by chronically struggling members) and further lowered quotas in its fourth production cut since October 2022. This level of overproduction isn’t a lot in the scheme of the millions of daily barrels of withheld OPEC+ output, but is absolutely blunting the effectiveness of the first quarter cut and, more concerningly, may be a sign of waning member patience with what seems like a never-ending production cut.
Iraq and Kazakhstan were the two biggest offenders, overproducing by a combined 330 kbpd in January or exactly two-thirds of the latest cut we were supposed to get. Group-wide overproduction would have been worse if not for continued quota underproduction from members like Nigeria, which still undershot by 80 kbpd its newly-lowered production target. Iraqi and Kazakh overproduction did not go unnoticed, and both countries pledged to comply and compensate for the overproduction, though Kazakhstan’s pledge seemed a touch more sincere than Iraq’s, which seemed to shift blame to external estimates and only came after a “visit to Baghdad from the Saudi Energy Minister,” according to Bloomberg.
Data Note: This is the first OPEC+ Data Deck to exclude Angola—which announced it was leaving OPEC in mid-December—from tables and graphics. I have also made the decision to remove Angola from historical tracking so as to maintain a consistent point of production reference; in the future, I plan to do more work on historical OPEC membership composition given that the producer group’s shifting membership roster has caused multiple instances of similar data breaks over the past decade (Qatar in 2018, Indonesia—twice, in 2009 and again in 2016—etc.)
[Full 34-Page OPEC+ Data Deck PDF Below Paywall]