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EIA: 2010 OPEC Outlook Revised Up By 30,000 B/D To 29.50M B/D

Mar 09, 2010

NEW YORK -(Dow Jones)- The U.S. raised its forecast for OPEC crude oil output this year but slightly lowered the growth rate for 2011.

Crude oil production from the Organization of Petroleum Exporting Countries is expected to average 29.50 million barrels a day this year, which is 30,000 barrels a day higher than the estimate released last month, according to the monthly outlook released by the U.S. Department of Energy's statistical arm, the Energy Information Administration.

Meanwhile, the EIA lowered its 2011 estimate for OPEC output by 30,000 barrels a day to 29.89 million barrels a day. OPEC produced 29.10 million barrels a day in 2009.

OPEC output was 29.49 million barrels a day in February, a 20,000-barrel-a-day increase from the prior month. According to EIA forecasts, monthly output is expected to fall to 29.49 million barrels a day in May and June and then peak at 29.58 million barrels a day in July. The July peak is 10,000 barrels a day lower than last month's estimate.

OPEC production is expected to average 30.14 million barrels a day during the second half of 2011.

EIA maintained its broader expectations for OPEC output, calling for an increase of 0.4 million barrels a day each year amid firm oil prices, according to the agency's Short-Term Energy Outlook. "EIA also projects a slight decrease in OPEC surplus crude oil production capacity" versus previous estimates, the report said.

OPEC is expected to maintain production quotas when the 12 member countries meet next on March 17. The group held quotas steady throughout 2009 after announcing a 4.2 million barrel a day cut in late 2008.

Previously, the EIA said that lower OPEC production in 2009, which fell by 2.2 million barrels a day, kept U.S. benchmark West Texas Intermediate prices mainly within the $70-$80 band. The U.S. agency is projecting WTI prices to $82 a barrel this year and $85 a barrel in 2011.

Saudi Arabia's output held steady at 8.2 million barrels a day in February with 3.8 million barrels a day of spare production capacity.

The EIA estimates that OPEC surplus crude oil production capacity will grow from 5.08 million barrels a day in February to peak at 5.39 million barrels a day in May, but average 5.2 million barrels a day for the year. In 2010, surplus capacity is expected to rise to 5.66 million barrels a day in 2011.

-By Naureen S. Malik, Dow Jones Newswires; 212-416-4210; naureen.malik@dowjones.com