Venezuela Keeps Producing below OPEC Target, Oil Rivals Fill in the Gap
Venezuela’s energy sector keeps suffering amidst vast national financial difficulties, as the country struggles to produce enough oil to meet its OPEC output target, allowing rival producers to fill in the gap, Reuters reports.
Venezuela’s oil output hit a 28-year low in October at 1.863M b/d, down 10% m-o-m, after falling by about 20K b/d per month since October 2016, as state-owned PDVSA has insufficient funds to drill wells and maintain existing infrastructure. Venezuela’s oil production is set to fall by at least 250K b/d in 2017, and 300K b/d in 2018, according to OPEC.
Iraq and non-OPEC producers Canada and Brazil have started replacing Venezuelan exports to the US and India, according to Thomson Reuters data. Iraq, the second largest OPEC producer has increased shipments of crude and condensate to India by 80K b/d this year, while Venezuelan deliveries dropped by 84K b/d. Moreover, Iraqi exports to the US in October were up 201K b/d m-o-m, while Venezuelan respective shipments dropped about 90K b/d m-o-m.