OPEC Output Slipped From a 14-Month High on Iraq, Survey Shows

March 31 (Bloomberg) -- The Organization of Petroleum Exporting Countries’ crude-oil production slipped from a 14- month high in March, led by an Iraqi cut, a Bloomberg News survey showed.

Output fell 30,000 barrels a day, or 0.1 percent, to an average 29.205 million barrels a day, according to the survey of oil companies, producers and analysts. Members with production quotas, all except Iraq, raised output by 55,000 barrels to 26.84 million barrels a day, the highest level since December 2008 and 1.995 million above their target.

OPEC cut its quotas by 4.2 million barrels to 24.845 million barrels a day beginning in January 2009 as fuel demand tumbled during the worst recession since World War II. The group left the targets unchanged at a meeting March 17 in Vienna.

“With oil near $82 it’s going to be hard to get them to cut back by much,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts.

Compliance among the 11 members with output quotas fell to 53 percent in March from 54 percent in February. All members exceeded their production limits. Last month’s total for all members was the highest since December 2008.

Crude oil has risen 11 percent since the beginning of February to $82.37 a barrel on the New York Mercantile Exchange.

“OPEC gets nervous when prices look like they are heading to $85 a barrel,” said Rick Mueller, director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. “They won’t hesitate to put more oil on the market if they believe prices will go much higher. We’re seeing a gradual erosion in quota discipline.”

Iraqi Production

Iraqi output dropped 85,000 barrels a day to 2.365 million in March, the biggest decrease in OPEC. February production was revised 65,000 barrels a day higher.

Nigeria’s production rose 70,000 barrels to 2.01 million barrels a day, the largest increase in the group. Africa’s biggest oil producer exceeded its target by 337,000 barrels a day. Attacks by the Movement for the Emancipation of the Niger Delta and other armed groups on Nigeria’s oil industry have cut the nation’s exports by more than 20 percent since 2006.

“Neither Nigeria nor Iraq is a stable, safe, country,” Mueller said. “It’s no surprise that their production figures are erratic.”