OPEC kept forecasts for global oil supply and demand unchanged in its last monthly assessment before members meet to review the market.
The 13 nations of the Organization of Petroleum Exporting Countries pumped 32.44 million barrels per day in April, slightly less than will be required in the third quarter.
Production rose as gains in Iran and Iraq compensated for losses in Nigeria and Kuwait. Investment by the global oil industry through 2018 will slump to less than half the amount spent from 2012 to 2014 following the collapse in prices, OPEC was cited as announcing by Bloomberg.
Oil prices have rebounded more than 75% from the lows reached in February as US shale production falters, signaling that Saudi Arabia’s strategy to re-balance oversupplied world markets is taking effect.
OPEC, which failed to complete an accord with non-members last month on capping output, has no current plans to revive supply limits when ministers meet on June 2, six delegates said on May 4. “It is widely recognized that an adequate return on investment is needed to maintain production levels, as well as to allow for the growth,” the group’s Vienna-based research department said in the monthly report. “A return to balance is a shared interest among consumers and producers alike.”
OPEC production increased by 188,200 bpd last month to 32.44 million, according to the report. While the group’s supply has typically exceeded the required amount in recent months, April output is about 380,000 bpd below the 32.8 million that OPEC estimates will be needed in the third quarter.
The potential shortfall is a further indication the organization’s policy is working. Global oil demand will increase by 1.2 million bpd, or 1.3%, this year to 94.18 million a day, according to the report. Supplies from outside the group will shrink by 740,000 bpd to 56.4 million.
