…Expects sustained push to maintain cut
22 March 2017, Sweetcrude, Lagos – The Organisation of the Petroleum Exporting Counties, OPEC, has achieved 106 percent compliance level with regard to its decision four months ago to cut production by 1.2 million barrels per day from January this year.
The first such deal since 2008, the decision which brought OPEC’s production down to 32.5 million per day, bpd, was aimed at stabilising crude oil prices and achieving market rebalance.
Figures published in OPEC’s latest monthly report revealed the 106 percent adherence to cuts.
This was also one of the issues reviewed last Friday at a meeting of a six-nation Compliance Monitoring Committee in Vienna, Austria, where compliance numbers were evaluated by the committee comprising OPEC members Saudi Arabia, Kuwait, Venezuela, Algeria and non-OPEC Russia and Oman.
The 106 percent achievement by OPEC came amid reports that the 11 non-OPEC oil producers that joined a global deal to reduce output by 1.8 million barrels per day, bpd, from January 1 this year to boost prices delivered 64 percent of promised cuts in February, lagging the impressive OPEC levels.
With these developments, sources at the OPEC headquarters in Vienna said the 13-nation organisation now expected sustained push to maintain the output cut.
Russia, which was part of the meeting on Friday, plans to step up its adherence, saying it will cut output by the full amount it had pledged — 300,000 bpd — by the end of April and will maintain that level until the deal expires at the end of June.
“High compliance with supply adjustments by OPEC and some non-OPEC producers supported gains” in crude oil futures in February, OPEC said.
OPEC, in its monthly oil market report for March, said its total production in February averaged 31.96 million bpd, a decrease of 14,000 bpd over the previous month.
Output by its members that committed to cutting production under the November deal was 29.7 million barrels a day, compared with 29.9 million last month. Libya and Nigeria are exempted from the deal as they push to restore supply impacted by internal crises.
OPEC, however, put crude oil production from Nigeria at 1.526 million barrels per day in February, down from 1.533 million bpd in the previous month, based on direct communication.
Production from Nigeria’s fellow African oil producer, Angola, stood at 1.649 million bpd in February, up from the 1.615 million bpd recorded in January.
OPEC said production in Saudi Arabia, Iraq and United Arab Emirates showed the largest declines.