OPEC oil ministers hike quota; small producer Gabon exits

OPEC Quotas and Production [27534 bytes] Oil ministers of the Organization of Petroleum Exporting Countries have jacked up their group's production quota to a combined 25.033 million b/d for the rest of the year. The 513,000 b/d increase, ordered June 7 in Vienna, reflects the anticipated return of Iraqi oil to world markets and withdrawal of Gabon from OPEC membership. The former quota of 24.52 million b/d has been in effect since 1993.

June 17, 1996

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OPEC Quotas and Production [27534 bytes]

Oil ministers of the Organization of Petroleum Exporting Countries have jacked up their group's production quota to a combined 25.033 million b/d for the rest of the year.

The 513,000 b/d increase, ordered June 7 in Vienna, reflects the anticipated return of Iraqi oil to world markets and withdrawal of Gabon from OPEC membership. The former quota of 24.52 million b/d has been in effect since 1993.

The United Nations' Security Council has agreed to lift the U.N.'s 6 year old embargo on Iraqi oil exports under certain conditions. The aim is to allow the battered nation to export as much as $2 billion worth of oil during 6 months to pay for purchases of urgently needed food and medical supplies.

Instead of its former production quota of 400,000 b/d, ministers as- signed Iraq a provisional volume of 1.2 million b/d as an "allocation." That amounts to a quota, although Iraq was not a party to the new order on quotas.

To arrive at the new volume, ministers added a provisional 800,000 b/d to the former combined quota to accommodate Iraq, then subtracted Gabon's volume.

Gabon's withdrawal

Gabon's exit from OPEC had been expected for some time (OGJ, Mar. 18, p. 27). Like several other OPEC members, Gabon was producing more than its quota in a bid to bolster a flagging economy. Figures for last March, the latest month for which data were available from all members, place OPEC production at 25.85 million b/d, 1.33 million b/d over quotas.

Gabon was OPEC's smallest producer yet was expected to pay the same membership fees as all other members. This became too burdensome, and Gabon had fallen behind on its payment of fees.

Gabon's withdrawal left OPEC with 11 members out of a list that once numbered 13. Ecuador, also a small producer strapped for cash, pulled out late in 1992.

Other members' quotas are to remain the same until Dec. 31.

The next regularly scheduled meeting of OPEC ministers is Nov. 27 in Vienna.