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No apparent ease of Gulf oil shipments

Shipments of crude oil from the Middle East to refiners worldwide showed no signs of slowing in early March as spot tanker loadings increased, despite OPEC's pledge to plug above-quota leakage, a leading oil tanker analyst said on Tuesday.
/ Source: Reuters

Shipments of crude oil from the Middle East to refiners worldwide showed no signs of slowing in early March as spot tanker loadings increased, despite OPEC's pledge to plug above-quota leakage, a leading oil tanker analyst said on Tuesday.

"The first evidence of February into March sailings is that exports are up," said Roy Mason of consultancy Oil Movements.

"And there is no evidence of progress on the issue of compliance (with quotas) in the first 10 days of March. It still might happen though, right now, it doesn't look as though it will," Mason said referring to OPEC's decision earlier this month to immediately eliminate 1.5 million barrels per day (bpd) of extra output above official quotas from world markets.

Mason said total estimated crude oil sailings from the Middle East in February, including regular contractual export deliveries as well as spot tanker bookings, rose to 16.87 million bpd against 16.630 million for the month of January.

Spot tanker loadings or bookings from the Middle East rose to 8.75 million bpd in the first 10 days of March, up from an average of 7.49 million bpd in February and 6.89 million bpd for seasonally slow January, his figures show.

"Since November there hasn't been much of a change (in terms of crude oil exports) and there is still no indication of a change here," Mason said.

Customers of several of OPEC's biggest producers have already said there has been no change so far for export nominations. Leading buyers of Saudi, Iranian, Kuwaiti, UAE and Nigerian crude say they have been awarded export volumes for March that are unchanged from February.

Earlier on Tuesday another oil tanker tracking consultancy said OPEC production looks likely to have moved marginally higher in February, with supplies rising by 75,000 bpd from January. Geneva's Petrologistics told clients it expected OPEC in February to produce 27.94 million barrels a day from 27.865 million bpd in January.

It said the 10 members of OPEC bound by quotas, excluding Iraq, raised production by 35,000 bpd to 25.94 million bpd. Iraq accounted for the extra 40,000 bpd, pumping two million bpd. That would put the OPEC 10 in February at 1.44 million bpd in excess of their official supply quotas of 24.5 million, compared to 1.405 million bpd in excess during January.

Mason said OPEC shipments in February rose to 23.1 million bpd against 22.9 million in January and 23.2 million in November, Oil Movements figures showed.

He said evidence of whether OPEC was sticking to its decision to slash one million bpd from official production from April 1 -- hammered out at a meeting in Algiers two weeks ago -- would not show itself until mid-March as bookings were made three weeks in advance.

But he said that in the near term he would expect oil in transit to come down as the seasonally slow second quarter for oil demand arrived.

"Whatever happens we should see sailings fall. And if production cuts are stuck to we should see sailings come down further," Mason said.