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Together. the twenty-two countries of the OPEC oil output cut deal are producing about 470.000 barrels per day (b d) in excess of their commitment. the International Energy Agency (IEA) said in its August Oil Market Report.
“Some of them are clearly determined that the output agreements will succeed: Saudi Arabia has indicated that export levels in August will fall to 6.6 million b d. and. according to recent reports. it will cut customer allocations in September. Other countries currently have very low compliance rates. although this can change.“ said the report.
OPEC crude output rose by 230.000 b d in July to a 2017 high of 32.84 million b d. led by a strong recovery in Libya. according to IEA estimates.
“Output from the 12 members included in the output pact edged up. eroding the compliance rate to 75 percent. the lowest this year. Year-to-date compliance is 87 percent.“ said the report.
“There would be more confidence that re-balancing is here to stay if some producers party to the output agreements were not. just as they are gaining the upper hand. showing signs of weakening their resolve.“ IEA analysts believe.
On May 25. OPEC member countries and non-OPEC parties. Azerbaijan. Kingdom of Bahrain. Brunei Darussalam. Kazakhstan. Malaysia. Mexico. Sultanate of Oman. the Russian Federation. Republic of Sudan. and the Republic of South Sudan agreed to extend the production adjustments for a further period of nine months. with effect from July 1. 2017.
The reductions will be on the same terms as those agreed in November.
