PLATTS SURVEY: Libyan surge offset by Kazakh drop as OPEC+ oil output up 30,000 b/d in Oct

OPEC+ crude oil output rose 30,000 b/d month on month in October, with a huge rebound in Libyan production largely canceled out by reductions in Kazakhstan, Iraq and Iran, according to the latest Platts OPEC+ Survey from S&P Global Commodity Insights.

With October output likely to set the tone for the upcoming ministerial meeting in Vienna on Dec. 1, the core OPEC group boosted output by 330,000 b/d, while its Russia-led allies cut by 300,000 b/d, according to the survey.

Core OPEC output from countries bound by quotas remained above their collective target, with overproduction shrinking slightly to 348,000 b/d, while their OPEC+ partners collectively underproduced by 179,000 b/d. Overall OPEC+ production in October was 169,000 b/d over target.

Compliance could therefore continue to fray relations within OPEC+, which is battling to put a floor under prices while maintaining its market share amid tepid Chinese demand, elevated production in non-OPEC+ countries in the Americas, fears of a supply glut in 2025 and considerable volatility driven by wars in the Middle East and Europe as well as the re-election of Donald Trump.

Libya and Kazakhstan saw the biggest shifts in crude output in October, the survey found, with the North African country hiking production by 420,000 b/d following the conclusion on Oct. 3 of an oil shutdown prompted by a political feud over the leadership of the Libyan central bank.

Production nevertheless remained below pre-shutdown levels of 1.15 million b/d due to maintenance at the key Sharara field in the first weeks of October.

Libya, beset by political chaos since the fall of Moammar Qadhafi in 2011, is not subject to an OPEC quota unlike Kazakhstan, which slashed output by 300,000 b/d after carrying maintenance lasting around three weeks at its enormous Kashagan oil field during October.

At 1.22 million b/d, Kazakhstan's output was still slightly above its 1.203 million b/d target as laid out in its August "compensation plan," submitted to make up for excess production in 2024.

Iraq also cut output by 60,000 b/d to 4.14 million b/d, primarily on cuts to export volumes and refinery runs, as well as reduced production in the semi-autonomous Kurdistan region, over which Baghdad has scant control. Nonetheless, Iraq -- which has also submitted compensation plans -- remained above its quota by 235,000 b/d.

The UAE also exceeded its quota in October by 98,000 b/d, the survey found, as did Gabon, Saudi Arabia and Russia, while Iranian output fell 40,000 b/d on lower exports.

A sticking point for the bloc going back decades, compliance has emerged as OPEC+'s key challenge in recent times, with sources telling Commodity Insights that inventories would be lower and the market tighter had producers stuck to their quotas.

On Nov. 3, eight voluntary cutters again delayed plans to start tapering 2.2 million b/d of reductions -- part of 5.8 million b/d of group-wide cuts -- to January 2025, amid fears prices would weaken even further had they followed through with the plans.

Platts, part of S&P Global Commodity Insights, last assessed the Dated Brent benchmark at $74.07/b on Nov. 8, down from a 2024 high of $93.35/b in April and below the fiscal breakeven oil prices of most members, according to Commodity Insights estimates.

A well-placed source told Commodity Insights that the eight voluntary cutters -- Algeria, Iraq, Saudi Arabia, Russia, Oman, Kazakhstan, Kuwait and the UAE -- had delayed the return of barrels because they did not have "line of sight on Chinese demand" moving forward.

Call on crude

OPEC production including quota-exempt Iran, Libya and Venezuela reached 26.58 million b/d in October, up from 26.25 million b/d in September, the survey found. Meanwhile, the Russia-led allies pumped 13.68 million b/d, down 300,000 b/d month on month.

Total OPEC+ output was 40.26 million b/d, up slightly from September but down 2.45 million b/d year on year.

In its latest monthly oil report, OPEC estimated the call on OPEC+ crude -- the quantity it must produce to balance supply and demand -- at 42.8 million b/d in 2024 and 43.2 million b/d in 2025, significantly above current production.

The swing producer is more bullish than other forecasters, but if that is borne out, OPEC+ would be in a strong position to control the market moving forward.

The Platts survey measures wellhead production and is compiled using information from oil industry officials, traders and analysts, as well as by reviewing proprietary shipping, satellite and inventory data.