LONDON (Dow Jones)--Saudi Arabia's new oil production target under the Organization of Petroleum Exporting Countries' latest output cut is 8.05 million barrels a day, which is marginally lower than the kingdom's previous quota in November, according to an OPEC document obtained by Dow Jones Newswires.
The kingdom's output quota was 8.48 million barrels a day under OPEC's previous quota that took effect in November.
OPEC announced its biggest ever output reduction of 2.2 million barrels a day on Wednesday to halt the sharp drop in crude oil prices. Under that announced production cut, Saudi Arabia's implied output target should have easily fallen well below 8 million barrels a day based on recent comments from Saudi Arabia's oil minister Ali Naimi, who said this past weekend that the kingdom was pumping 8.2 million barrels a day and based on the kingdom's November quota.
Many oil traders and analysts have questioned the integrity of the latest announced OPEC output reduction, saying that the group's 11 quota-bound members chose to use a much higher output baseline from which to cut output. This would mean OPEC members, which are facing sharply lower crude oil revenues due to falling oil prices and lower production, are actually cutting output by less than they say they are.
OPEC, as it usually does, chose not to publish a country-by-country breakdown of production targets under the group's latest announced cuts.
OPEC's new reduction, which takes effect Jan. 1, 2009 and uses the group's September output as its baseline, followed two other cuts in September and October totaling 1.7 million barrels a day.
Iran, OPEC's second-largest oil producer after Saudi Arabia, has a production target of 3.34 million barrels a day under its new quota against its previous allocation in November of 3.62 million barrels a day. Venezuela's new production target is 1.97 million barrels a day versus 2.34 million barrels a day previously.
Few analysts doubt the kingdom is cutting its production by a huge amount but say the Saudis are tired of shouldering the burden of OPEC's production cuts while some nations don't abide by their output commitments. Iran and Venezuela are frequently cited by analysts for not honoring their commitments to lower production.
OPEC member's production quota targets effective Jan. 1, 2009.
All figures are in million barrels a day. Iraq isn't part of OPEC's quota system.
Algeria 1.202
Angola 1.517
Ecuador 0.434
Iran 3.336
Kuwait 2.222
Libya 1.469
Nigeria 1.673
Qatar 0.731
Saudi Arabia8.051
UAE 2.223
Venezuela 1.986
TOTAL 24.845
Source: OPEC
-By Spencer Swartz, Dow Jones Newswires; +44 207 842 9357; spencer.swartz@dowjones.com