LONDON, 29 March 2003 — Saudi Arabia led a heavy increase in OPEC oil production in March, preventing a spike in crude prices as the United States went to war against Iraq, a leading energy consultancy said yesterday.
The Organization of the Petroleum Exporting Countries was able to more than compensate for cutbacks in exports from Iraq and Nigeria, both OPEC member countries, Geneva-based Petrologistics said in a closely-watched report.
OPEC’s biggest producer Saudi Arabia was responsible for a large chunk of the extra oil, along with Venezuela where the state petroleum company has restored a lot of production after a strike.
The Kingdom added 600,000 bpd to average 9.56 million bpd and Venezuela increased by the same increment to 2.45 million bpd, recovering from a general strike more quickly than expected. The increase took Riyadh to its highest crude production in 21 years. Veteran OPEC watcher Geoff Pyne, consultant to Sempra Energy, said it was Saudi Arabia’s heaviest production since October 1981. “Saudi Arabia promised to make up for any shortfalls and that’s exactly what they’ve done,” said Raad Alkadiri of Petroleum Finance Corp. in Washington.
Total OPEC output, despite lower Iraqi and Nigerian volumes, rose by 430,000 barrels a day in March to 28.36 million bpd, the Petrologistics report said.
Output excluding Iraq, measured for 10 OPEC members with official group quotas, rose by 1.55 million bpd to 26.85 million.
The report will fuel worries in OPEC about a possible glut in the second quarter, when world fuel demand subsides seasonally after the winter. OPEC Secretary-General Alvaro Silva said yesterday the group was on alert for a possible price crash.
