Update: OPEC January MOMR with December Production Data

The OPEC January Monthly Oil Market Report is out with crude only production data through December 2012. Total OPEC crude only was 29,223,000 barrels per day, down 20,000 barrels per day. But that was after November production was revised down by 170,000 bp/d. So December production was down 190,000 bp/d from what they originally reported last month.

OPEC 12

 

Big movers were Iraq and Libya. Iraqi November production was revised down by 132,000 bp/d and their December production was down another 55,000 bp/d meaning they were down 187,000 from what was originally reported last month.

Iraq

Libyan November production was revised down by 110,000 bp/d but they were flat from the new revised number in December.

Libya

However there are reports that Libyan production had increased to 600,000 bp/d by mid January.

I am of the opinion that every OPEC country, including Saudi Arabia, is now producing flat out. Production varies from month to month because they keep on drilling new horizontal wells, pulling the cream right off the top of the reservoirs. They did cut production back in late 2008 but within a year every country except Saudi Arabia, Kuwait and the UAE was back to producing flat out again. Then when the Libyan revolution hit in 2011 these three began production producing flat out again.

Of course Libya and Iran could produce more but both are producing all they can “under the current circumstances”. But circumstances will always vary and limit production as Iraq is very aware of. So all we can do is look at production as it is today, not what it might be “if only”.

SA+UAE+Kw

The OPEC MOMR used to report production numbers from “secondary sources” only. But Venezuela complained that their production was being under reported. So OPEC started then reporting two sources of data, one from those “secondary sources” and another from “direct communication”. Direct communication means: “We called them up and asked them and this is what they told us.”

Secondary Sources

Secondary Sources 2

I know you are wondering just who those “secondary sources” are. Well so am I but I would guess they are kind of an average of several sources, Platts being just one of them.

The page OPEC Charts has been updated with the December production data from the latest OPEC MOMR. Crude only production charts of all 12 OPEC countries are posted there.

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98 Responses to Update: OPEC January MOMR with December Production Data

  1. From the Telegraph in the UK. Have to get all the way to the penultimate sentence to find the key issue. But I guess he does hint at the contradiction of a supply bubble from expensive oil depressing the price: surely an unsustainable circle. This would suggest the end of the price stability of the last three years coming at some point [a year away?]: perhaps a price dip followed by a financial crunch on marginal producers-> fall in supply-> price rise and so on? As the writer says: ‘Much drama can intrude along the way.’

    http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/10575292/Coming-oil-glut-may-push-global-economy-into-deflation.html

    • aws. says:

      Lots of folks using the word ‘repricing’ these days…

      Gregor

      Chris Nelder (btw Chris’ June 2012 Brent $105 floor and $125 ceiling forecast was prescient)

      Dr. Sadad Al-Husseini

      Q: A key aspect of supply, going forward, is price volatility. How vulnerable is world oil supply to a drop in price to $60 or $70, which some economists are predicting?

      The prospect of a severe oil price drop can only happen as the outcome of another economic collapse. On the other hand, an upward spike in oil prices is far more credible given the military tensions across the world that could disrupt oil supplies and the limited elasticity in supplies. Dysfunctional governments and failed states are now a pervasive syndrome across the world. There is little evidence that the collective global leadership is able to contain or to stabilize these many crises.

      My base oil price forecast in 2012 dollars still ranges between $105 and $120/barrel Brent with a volatility floor of $ 95/barrel and more probable upward spiking to $140/barrel within 2016/2017.

      Ambrose’s scenario is quite possible. It’s best to be reminded that the highest the price has been recently was July 2008 and the lowest it’s been recently was December 2008 ( a $90 monthly average price difference). The oil price has been remarkably stable for quite some time… expensive but stable.

      Unpleasant 2008-style volatility has to be expected at some point.

  2. old farmer mac says:

    Pritchard is a world class reporter but I don’t know if he is a good energy analyst.

    Given that I think the world economy isn’t doing all that well, I guess I must agree with him that if most of the places that could up their oil production such as Iran and Libya, if political conditions permit, oil could come down for some time, maybe a year or two or even longer if the world economy really does
    do a nose dive.

    But I can’t see how lower oil prices are going to hurt the overall economy at all.

    In the meantime, depletion and rust never sleep, and here’s an article from the NYT about the tough times oil companies are having these days.

    I’m not a stock market expert and I don’t have a MBA from some prestigious university, but I have read the business nerds for years, and a also a few books about the management of big businesses.

    When an industry is in big trouble for one reason or another, and it is dominated by a few big corporations, as the oil industry is, it’s very common for top management to start cannibalizing the company in order to keep the stock holders happy in the short term.

    It seems that the stockholders seldom notice that heir dividend check is the result of selling off assets rather than turning a profit running the business and that management therefore gets away with this strategy.

    Reading just a little between the lines, this article seems to be saying that the oil majors are in a very tough spot and don’t really seem to see any way out of it.

    Putting it another way, it can be read as evidence pointing towards peak oil.

    http://www.nytimes.com/2014/01/21/business/international/shell-to-sell-stake-in-australian-gas-field.html?hpw&rref=business&_r=0

  3. aws. says:

    Climate Proofing of Farms Seen Too Slow as Industry Faces Havoc

    By Rudy Ruitenberg, Bloomberg, Jan 20, 2014 2:27 AM ET

    Climate change will play havoc with farming, and policy makers and researchers aren’t fully aware of the significance on food supply, according to the World Bank.

    Earth will warm by 2 degrees Celsius (3.6 degrees Fahrenheit) “in your lifetime,” Rachel Kyte, the World Bank’s vice-president for climate change, said at a meeting of agriculture ministers in Berlin over the weekend. That will make farming untenable in some areas, she said.

    Wonder if Gerry and Barnaby were paying attention?

  4. aws. says:

    Train Derailment Temporarily Shuts Down Stretch Of Schuylkill Expressway

    Mark Abrams, CBS Philly, January 20, 2014 7:46 AM

    Seven cars on a CSX freight train from Chicago to Philadelphia derailed early Monday morning in the area of the South Street Bridge, prompting a shutdown of a stretch of the Schuylkill Expressway for a couple of hours.

    Officials say the accident happened shortly after 12:30 a.m. on a railroad bridge spanning the Schuylkill Expressway [and beside Schuykill river].

    They say six of the cars on the 101-car train were carrying crude oil and one was carrying sand [for fracking the Marcellus?].

  5. old farmer mac says:

    This article has summaries of spending world wide on renewable energy.

    http://www.csmonitor.com/Environment/Energy-Voices/2014/0115/Clean-energy-investment-down-but-not-out

  6. old farmer mac says:

    http://online.wsj.com/news/articles/SB10001424052702303802904579334023256421590?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303802904579334023256421590.html

    I suppose there might be some truth in this article because American refiners want only so much of the extra light tight oil these days, given that they are optimized for heavier crudes.

    Modifying a refinery to use more of it would obviously be a time consuming and costly undertaking.

    Now there’s another question to be considered, one that the WSJ won’t likely touch with a ten foot pole.

    Why wouldn’t at least a couple of refinery owners go ahead and make the modifications needed to process this flood of LTO? They can get it cheap and there should potentially be plenty of money in refining it .

    Maybe they refiners are like the pipeline operators?Maybe they don’t think the LTO boom will last.

    We see speculation here- apparently well grounded- that nobody wants to build pipelines into LTO country because they believe the LTO boom will crash before they can recover their investment and make a profit.

    • Synapsid says:

      OFM,

      An example of what you refer to about building pipelines is ONEOK’s proposed Bakken Express pipeline that was to have carried Bakken crude to Cushing, OK. The company canceled the proposal when it couldn’t find enough subscribers.

  7. Jeffrey J. Brown says:

    Jim Cramer, at 9:32 A.M., 1/21/14, on CNBC:

    “By the way, unless we get the export of oil. I mean there’s just a glut everywhere. Natural gas, because that’s a byproduct of finding oil, we burn off more than we use.”

    My comments:

    In effect, Jim Cramer seems to assert that the US is venting and flaring in excess of 50% of dry natural gas production. Here is the annual data table through 2013:

    http://www.eia.gov/dnav/ng/ng_prod_sum_dcu_NUS_a.htm

    In reality, in 2013 the EIA estimates that the US vented and flared less than 1% of dry natural gas production.

    And so it goes.

    • There is a reason that gas is flared. It is flared because it would be uneconomical for the oil companies to lay a pipeline to collect the gas. The gas that is flared is almost all from shale tight oil wells. They truck the oil out but of course cannot truck the gas out. And natural gas prices are low and the production falls off fast from these tight oil wells. They would not collect enough gas to pay for the pipeline to get it out.

      • toolpush says:

        Ron,

        Yes the gas is flared because it is uneconomical to sell. But economics is a funny thing in business. Being “uneconomical” to most people sounds like they would be losing money, which ain’t necessarily so. It may just mean for money invested in drilling more oil wells brings a greater return on the investment, than spending that same money on pipelines and separation equipment does.

        Which to me brings into play the moral question of burning off these resourses, not for the sake of making a profit but for the need to maximze the profit, where in my opinion we should instead be maximizing the use of the resourse and the longer term economic health of the economy, rather than just focusing on next quarterly numbers.

        I suppose I would be burnt at the stack in Wall St for having such heretical thoughts, but nearly every country that has burnt off their excess gas to produce oil end up dreading the day they did. The US, (before shale) UK, Saudi Arabia, to name a few.

        With the pad style drilling they are currently doing the collection of Nat gas becomes a whole cheaper than a few widely dispersed oil wells. A stroke of the pen with a sensible regulation would have the gas being put to good use in very short order. Not to mention pollution, greenhouse or any of that.

        • Toolpush, you make it seem so simple. Just a stroke of the pen. No, it’s all a package deal. The total economy of the well is what the oil companies are looking at. If they are forced to lay pipelines costing several millions of dollars, then they might not drill the well at all, leading to no oil nor gas.

          Oil companies are not altruistic organizations. They exist to make money for their stockholders. You can rave until the cows come home that they should be more, that they should be good stewards of the earth, but that will not change anything one iota, they are in business to make a profit and they will fight ever attempt to regulate them.

          The world is what it is Toolpush, not what we think it should be.

          • Dennis Coyne says:

            Hi Ron,

            It is simply a matter of passing regulations to require that natural gas is collected and shipped somewhere or reinjected. States such as Texas already have such regulations in place. The federal government should pass a law similar to the Texas law for states that don’t have such regulations. States can pass their own regulations that are more demanding if they would like, the Federal regulation would be a minimum requirement. It really is just a stoke of the pen. If it is not profitable to do it by following the regs, then it won’t be done.
            If Texas can do it, it can be done elsewhere.

            DC

          • Dennis wrote:
            It is simply a matter of passing regulations to require that natural gas is collected and shipped somewhere or reinjected. States such as Texas already have such regulations in place.

            If Texas can do it, it can be done elsewhere.

            Well now, someone should tell those folks down in the Eagle Ford area to start obeying the law. Hint: That long sweeping row of lights just below San Antonio is gas being flared in Eagle Ford.
             photo EagleFordfromSpace_zpsc707f248.png

            Also, I am no oil man but I would bet my bottom dollar that reinjection of gas into a tight oil reservoir, where the only open spaces are those that have been blown open by fracking pressure, is a totally different animal than reinjection of gas into a porous reservoir.

            This article explains why they are flaring in both Eagle Ford and the Bakken:

            Shale oil boom sends waste gas burn-off soaring

            “The gas is worth very little in comparison to oil,” said Bruce Hicks, assistant director of North Dakota’s state’s oil and gas division. “This is an oil-driven play.”

            Companies say temporary flaring is unavoidable, especially in fields like the Eagle Ford and the Bakken where the pipeline infrastructure is incomplete.

            Dennis, Texas does have an anti-flaring law. But the point you missed is that all the oil companies have to do is apply to the Texas RRC for an exemption… and they get it.

            • Dennis Coyne says:

              Ok I stand corrected. I think the regulations help, if there were no regulations and no need to get a permit to flare the gas, I think there would be more gas wasted. I am also not an oil man, but Rockman would often say that the regs in Texas were followed to avoid fines. If companies needed to pay a large fee to acquire the permits for flaring it would provide an incentive to build pipelines. I am pretty sure this is not the case in North Dakota, do you know if the companies need to pay a fee to acquire those flaring permits?

              DC

          • Woody says:

            Ron, you hit the nail on the head. It is a packaged deal. If oil companies are prevented from flaring gas then they would just have to look at the economics of the whole deal. If it wasn’t good enough at current prices, the well wouldn’t get drilled. What’s wrong with that? The Bakken has been known for 50 years but not exploited due to cost issues. If it had to wait a couple more years for oil prices to rise higher or gas prices to rise higher what’s the problem? At some point prices would make the combined oil and gas economical.

            You know as well as anyone that the US will wish we had the flared gas in a few years time. Why apologize for the industry? They may have the upper hand politically but it doesn’t mean that what they are doing is good public policy or beneficial to the rest of the country.

            If flared gas was called pollution, then the cost of preventing that pollution would just be part of the cost of doing business. Which is exactly what the rest of us have to deal with on a daily basis.

  8. Jeffrey J. Brown says:

    Ron,

    That’s true of course, but my point is that Cramer is asserting that we are venting/flaring in excess of 66 BCF/day. To put this in perspective, 2013 annual Gulf of Mexico marketed natural gas production was 3.3 BCF/day (federal waters). So, Cramer is asserting that we are venting/flaring the productive equivalent of 20 times the daily production from the Gulf of Mexico.

  9. Kam says:

    [i]“Total OECD commercial oil inventories plummeted by 53.6 mb in November, their steepest monthly decline since December 2011, led by a plunge in crude oil and ‘other products’. Preliminary data for December indicate a further 42.5 mb draw in OECD inventories.”[/i]
    This is from today’s Oil Market Report.

  10. Jeffrey J. Brown says:

    Small correction, Cramer is in effect asserting that we are venting/flaring in excess of 100% of dry natural gas production (not 50%).

  11. Calhoun says:

    Quotation of the week:

    “Oil production from Saudi Arabia, OPEC’s leading supplier, declined 3.5 percent from the third quarter of 2013 to settle at 9.6 million bpd during the fourth quarter, leaving plenty of room for U.S. production growth.”

    http://oilprice.com/Energy/Natural-Gas/What-Happens-After-the-Shale-Revolution.html

    OK, so we need KSA to decrease production in order to “make room” for U.S. production growth. Huh?

  12. old farmer mac says:

    Here’a an excerpt from an article at oil price .com today:

    BP said in its report the United States should overtake Saudi Arabia this year in terms of oil production. By Riyadh’s own account, that comes as something of a relief as it addresses changes to its own market dynamics brought on by an increase in regional energy demand. For OPEC as a whole, its share in the oil market declines for much of the decade but recovers by 2020 as U.S. oil production slows down. BP’s report suggests U.S. oil production, meanwhile, falls by 75 percent through 2035.

    Decline in U.S. shale production, and the inability of other countries to replicate the success, is not so much validation of peak oil theory as much as it is a return to the status quo, where Middle East and North African producers dominate the market.

    I wonder what these guys would consider validation of peak oil theory when they can say “not so much validation of peak oil theory” in a sentence when they accept that US production will decline by 75 percent in the opinion of BP without raising an eyebrow in the previous sentence..

  13. aws. says:

    Propane shortage sets off epidemic of dickish* behaviour

    Frank B. Edwards, Bungalo Books blog, Posted on January 10, 2014

    Since my heat died on Sunday, I have found myself surrounded by dickish people.

    The biggest dick of all — albeit a reluctant one — is probably the guy who owns the fuel company I pay to keep me warm. For reasons known only to him and his inner circle (his wife, his dog and the guys in the truck yard), he decided to reduce the amount of gas he put in his customers’ tanks — without telling them. When I saw the big tanker back down my driveway on December 13th, I assumed I was getting my usual 600 litres — about a six to eight week supply. So it came as a real surprise three weeks later that my tanks were empty and my furnace shut down in the midst of a severe cold weather front.

    What a dickish thing to do to his customers. Simply including a note with each delivery warning that fuel was in short supply would have been much better. Presumably he thought the problem would sort itself if he kept quiet about it. Sort of ostrich-style dick behaviour by a guy who probably isn’t really a dick at heart.

    But there were plenty of other dickish people around to make matters worse.

    Take for example, the dick who put together the National Energy Board report of November 28th that assured Canadians that propane supplies and prices would be stable throughout the winter. Somehow, the NEB was not paying attention to American statistics that indicated corn farmers were drawing a dangerously high share of the fall stockpile (giving me yet a new reason to complain about the dickish American corn industry).

    Then, of course, there are the dicks at the Canadian Propane Association who keep telling anyone who asks that there is no propane shortage. Their website is devoted to increasing propane usage so there is no discussion about why thousands of families in Ontario are low on heating fuel.

    As a reminder…
    Propane Inventories Fall to Lowest Seasonal Level in 14 Years

    By Dan Murtaugh Nov 20, 2013 2:12 PM ET

    nventories in the Midwest slipped by 296,000 to 19.5 million barrels, the lowest level for this time of year since 1996. Crop-drying demand in the region has been larger than normal because of wet conditions and a record corn harvest.
    — snip —
    Crop-drying demand was at least 400,000 to 500,000 barrels a day over a several-weeks period,”

    If all those folks in cold houses knew that they have gone without because so much propane went to dry corn that had a 40% chance of ending up being used to make ethanol that would then be used to fuel North America’s dismally inefficient fleet of personal vehicles they perhaps might be a bit chuffed.

    • Woody says:

      Propane is also exported and exports have been growing significantly. End result is folks in the US and Canada will be paying the world price for propane.

    • aws. says:

      chuffed

      I don’t think that word means what I thought it meant. : )

      … steamed or pissed would have been more appropriate.

  14. aws. says:

    I should have added for those who aren’t familiar that the EROI of corn ethanol is around 1.

    Which is to say that the production of corn ethanol for fuel is a waste of effort.

    I wonder if EROI calculations factored in the propane used to dry corn. That said this was a wet harvest in parts of the mid-west leading to the increased propane demand. Still, it can’t of but lowered EROI!

    • Anonymous says:

      Corn based ethanol does accomplish one thing- it converts non liquid fuels not suitable for use in motor vehicles into liquid fuel.

      Natural gas becomes nitrogen fertilizer which becomes corn which becomes ethanol.

      Coal fired power plants supply electricity to corn farmers, distilleries, and the various businesses dealing in moonshine.

      Ethanol as a motor fuel on the grand scale is an ecological disaster and a huge overall waste of resources that could be put to good use.

      It’s hard to prove it directly but it’s also a humanitarian disaster in that it has forced up food prices to the extent that extremely poor people in some countries dependent on imported grain are actually starving, and it is causing a lot of poor people right here in the US hardship in the form of more expensive food.

      Now as to irony unsurpassed:

      The people who deny peak oil frequently lump ethanol in and talk about total liquids on a regular basis, knowing the public will assume the liquids are all petroleum.

      If there ‘s any such thing as evidence of the scarcity of oil, it is ethanol in gasoline.

    • HVACman says:

      Hydrogen is also rearing it’s disastrously low EROI head again. Toyota is doubling down on H2 fuel cell vehicle development and the California Energy Commission is started doling out millions for fueling stations. It all appears to be driven by some bizarre desire to push NG further into the transportation energy mix without calling it natural gas, make it look “renewable” by pretending it is generated by solar power, and do it all at taxpayer’s expense. The same phrase Elon Musk recently used to describe the H2 concept also applies to ethanol, “it’s mind-bogglingly stupid”.

      Maybe that’s the problem. It is so dumb that no one in either government or industry involved in ethanol or H2 wants to look like a grand fool and admit how dumb it really is, so they just press on with more programs, more energy and environmental smoke and mirrors.

      • KC says:

        HVAC – doesn’t matter how stupid it is. It just gives them another means of presenting a “diversity” of “fuel sources,” no matter that the sheeple have no idea from where or how the fuel source came. By suggesting the “diversity” of fuels, they can even get away with the silly claim that they are growing the energy pie – supposing that gee, now we have even more energy to play with, from thin air. Isn’t it nifty? See? Technology WILLsave us!

  15. aws. says:

    EIA : This Week in Petroleaum : Midwest propane markets tighten further on cold weather

    Released: January 15, 2014

    In October, EIA noted the effects of increased production of domestic oil and gas on propane flows between the Midwest and the Gulf Coast. Infrastructure changes have allowed the growing supplies of propane and other hydrocarbon gas liquids (HGL) from increased production to flow south from and through the Midwest to supply Gulf Coast petrochemical demand and also to gain access to the global market. Recently, the onset of severely cold weather in the Midwest has increased regional demand for propane and other heating fuels.

    Even before the recent cold snap, Midwest propane markets were relatively tight compared with those on the Gulf Coast for other weather-related reasons. In addition to space heating needs, the Midwest uses propane for agricultural applications such as corn drying….

    – snip —

    The Midwest will also need to prepare for the coming reversal of Kinder Morgan’s Cochin Pipeline, which delivers HGL from Canada to the upper Midwest. Kinder Morgan plans to reverse the flow to deliver light condensate to Canada. This reversal will change supply dynamics in the Midwest. However, this situation may also improve the economic prospects for infrastructure projects to process and transport HGL from the Bakken formation in North Dakota and Montana to Midwest markets farther east.

  16. aws. says:

    Propane companies struggle to get supplies into Maine

    BANGOR, Maine (NEWS CENTER) — With confusion over whether there is a shortage of propane, the Propane Gas Association of New England says that there is plenty of supply, but that the issue is with transportation and infrastructure.

    The deadly train explosion last year in Lac Megantic, Quebec caused suppliers to use alternate train routes that can’t handle the loads. That backed up supplies according to Senior Planner for the Governor’s Energy Office, Lisa Smith.

    “All those delays have caused the rail shipments to be two, three weeks behind,” said Smith.

  17. aws. says:

    EIA : Distillate (Heating Oil and Diesel)

    Interesting how gasoline has been at the top of the 5-year average for a year and distillate has been at the bottom of the 5-year average for the last year and a half.

    Lots of that Bakken BCO (Barely Crude Oil) yielding small fractions of distillate might do that? Not sure if that is the whole story but must be part of it.

  18. aws. says:

    Koch Ends Plans for Pipeline to Illinois From Bakken

    By Lynn Doan, Bloomberg, Jan 21, 2014 7:36 PM ET

  19. Anonymous says:

    Some local propane retailers are shorting their customers on the small containers commonly used to bbq outside and by some people to run their kitchen ranges and even to heat their homes.

    They are charging the same price for refills but putting in substantially less.

    If questioned they point to a small inconspicuous sign that gives the new higher price but a lot of customers don’t realize that other retailers still fill the tank all the way for the same money.

    There has been no legal action taken so far about this to my knowledge but I have heard about a retailer being accused of thievery and persuaded to refund the difference rather than being hauled into court.

    • The above comment was wrongly attributed to “Anonymous”. The author posted me and informed me of such. If anyone else has this problem please let me know.

      Ron DarwinianOne at Gmail.com

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