OPEC flounders amid an oil glut
OPEC is in big trouble, sources here agree.
This year, according to the OPEC secretariat in Vienna, the grouping of 13 oil exporting states will show a net loss of almost $10 million, compared with huge surpluses of $58 billion last year and $108 billion the year before.
World demand has dropped from 52 million barrels per day in 1979 to 45 million bpd today. OPEC production has fallen from 32 million bpd to 19.5 million bpd.
OPEC would like to be producing 24 million to 25 million bpd next year, but most forecasts show world demand staying almost flat until 1984 as the recession continues and consumers keep on saving energy. Saudi Arabia itself is within its March production quota of 5.8 million bpd. In December it was pumping 5.7 million.
Meanwhile, discounting and overproducing continues by Libya (whose unpredictable leader, Col. Muammar Qaddafi, has expansionist plans at home and abroad), Iran (fighting a war with Iraq), and Venezuela. Under current OPEC rules, Libya, which is close to European markets and has a high-quality oil, is supposed to sell at $35.50 a barrel; its production quota, set in March this year, is 750,000 bpd. But Colonel Qaddafi is said by industry sources to be selling 1.8 million bpd in December at $33.50 a barrel - even cheaper than Arabian crude.
Iran, still fighting Iraq, is also way over its OPEC production quota of 1.2 million bpd. Sources here say it is pumping 2.7 million bpd and exporting 2.2 million, at prices that have sunk as low as $26 to $28 per barrel.
Venezuela's March quota was 1.5 million bpd, but in December it was pumping 2 .3 million.
The March quotas tried unsuccessfully to hold total OPEC production to 17.5 million bpd to protect prices. Forecasts gathered by a new research group on petroleum exporters see demand for OPEC oil in 1983 between 19.5 million and 20. 9 million bpd, in a total world demand of between 45 million and 45.7 million bpd.
Says one pro-OPEC source: ''I see the real rogue states being non-OPEC countries such as Britain, Norway, and Mexico, who undercut us.''