UAE increases oil production to cover Libyan shutdown

Abu Dhabi: The UAE's oil output rose 0.8 per cent to 2.55 million barrels per day (bpd) in September compared to August, latest data from the Paris-based International Energy Agency (IEA) shows.

"Both Kuwait and the UAE raised output in September to the highest levels in around three years to help compensate for Libya's shutdown. However, Saudi Arabia, which increased output by around one million bpd in recent months, appears now to be scaling back supplies," said the IEA, which advises 28 industrialised countries on energy policy.

During the third quarter of 2011, the UAE's oil output averaged 2.53 million bpd, up from 2.48 million bpd during the second quarter, the IEA said. It added that the UAE will have a sustainable production capacity of 2.74 million bpd by the end of this year. Officials at the UAE's Ministry of Energy weren't available for comment.

"The UAE has the capacity to produce more oil and needs the cash. The international oil prices in September were very good," Khalid Al Awadi, a local energy expert, told Gulf News.

In August, the IEA lowered its global oil demand forecast by 60,000 bpd for 2011, citing lower than expected figures during the second and third quarters, sustained pressure of high oil prices and increased evidence of economic slowdown.

"Overall, global oil demand is expected to average 89.5 million bpd in 2011, 1.4 per cent higher year on year," said the IEA in its oil market report at the time.

"Concerns over debt levels in Europe and the United States, and signs of slowing economic growth in China and India have spooked the market and raised fears in some quarters of a double-dip recession. From an oil market standpoint, perceived wisdom is that this must inevitably mean weaker oil demand to come," it added.

Capacity: Powering ahead