Opec output is running at its highest level this year, but even more will be needed in the coming months to avoid a sizeable Q4 supply deficit. Moreover, any overall increase in Opec output will have to be achieved with the handbrake on, as Iranian output looks set to slump under renewed US sanctions (MEES, 7 September).
Opec’s August crude output averaged 32.57mn b/d, up 280,000 b/d on July, according to the average of secondary sources estimates used by Opec itself. But both the IEA and Opec in their latest monthly reports released this week estimate that Opec output will have to rise sharply in the final quarter to match global demand. By how much? Potentially more than 1mn b/d. (CONTINUED - 1359 WORDS)