* Supply falls by 110,000 bpd, led by Saudi, Libya
* OPEC output below 30 million bpd target for third month
* Libyan output rises in January, but recovery uncertain
(Adds further details from third paragraph, quote in fourth)
By Alex Lawler
LONDON, Jan 6 OPEC's oil output fell in December
to the lowest since May 2011, a Reuters survey found, due to
strikes and protests in Libya, stagnation in Iraqi exports and a
further reduction in Saudi Arabian supply.
Output from the Organization of the Petroleum Exporting
Countries averaged 29.53 million barrels per day (bpd), down
from 29.64 million bpd in November, according to the survey
based on shipping data and information from sources at oil
companies, OPEC and consultants.
The survey illustrates the drag on OPEC production from
unplanned outages, which helped keep oil prices above
$100 a barrel in 2013 and may persist. A rise in Libyan output
has weighed on prices in early 2014, but a further recovery is
by no means assured.
"Supply issues are still in the spotlight," said Carsten
Fritsch, analyst at Commerzbank. "In terms of Libya, it is too
early to say if production levels will stabilize further."
In December, protests in Libya, lower Saudi Arabian supply
and stagnation in Iraq outweighed an increase in Nigeria and a
further small rise in Iranian shipments.
OPEC's December output is the lowest since May 2011, when
the group pumped 28.90 million bpd according to Reuters surveys,
and leaves supply below OPEC's nominal target of 30 million bpd
for a third month.
Saudi Arabia, industry sources say, trimmed output due to a
reduced requirement for crude to fuel domestic power plants and
lower demand outside the country.
The kingdom has cut supplies from 10.05 million bpd in
August, the highest since records began in 1980, according to
figures from the U.S. Energy Information Administration.
In Libya, protests at fields and terminals limited supplies.
Output averaged 250,000 bpd in December, less than 290,000 bpd
in November and a fraction of the 1.4 million bpd it was pumping
earlier this year.
Output is set to rise this month after the reopening of the
El Sharara field at the weekend. The prospective restart at the
340,000 bpd field put downward pressure on prices last week.
Iraq's oil exports in December edged lower to 2.34 million
bpd. Bad weather kept a lid on shipments through southern
terminals, and exports of Kirkuk crude through northern Iraq
declined. Still, the completion of maintenance at southern
terminals should allow exports to rise this year.
Output rose in Nigeria, where supply has been increasingly
hit by spills and theft from pipelines, due to the end of
maintenance at Royal Dutch Shell's Bonga oilfield.
Iranian supply to market was estimated at 2.7 million bpd,
up 50,000 bpd, but still curbed by sanctions. Iran reached a
deal in November with six western powers to limit its nuclear
programme, under which sanctions on oil investment and trade
with Iran may be eased this year.
(Reporting by Alex Lawler; Editing by William Hardy)