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OPEC Output Falls But  Compliance Weakens
OPEC Output Falls But  Compliance Weakens

OPEC Output Falls But Compliance Weakens

OPEC Output Falls But Compliance Weakens

OPEC oil output fell for a fourth straight month in April, a Reuters survey found on Tuesday, as top exporter Saudi Arabia kept production below its target while maintenance and unrest cut production in exempt nations Nigeria and Libya.
However, more oil from Angola and higher UAE output than originally thought caused OPEC compliance with its production-cutting deal to slip to 90% from a revised 92% in March, according to Reuters surveys.
The Organization of Petroleum Exporting Countries pledged to reduce output by about 1.2 million barrels per day for six months from Jan. 1 - the first supply cut deal since 2008. Non-OPEC producers are cutting about half as much.
OPEC wants to get rid of excess supply that is keeping oil below $52 a barrel, half the level of mid-2014. With the oversupply proving hard to shift, OPEC is expected to prolong the agreement.
Compliance of 90% is still higher than OPEC achieved in its last cut in 2009, Reuters surveys show. Analysts including those at the International Energy Agency have put adherence in 2017 even higher, with the IEA calling it a record.
April's biggest production gain came from Angola, which scheduled higher exports and where output started at the East Pole field in February. The increase brought Angolan compliance down to 91%, from above 100 earlier in the year.
Iran's production rose slightly. Tehran was allowed a small increase in output under the OPEC agreement. Small increases came from Kuwait and Saudi Arabia, the survey found, although their compliance was the second-highest and highest respectively in OPEC.
Even with April's increase, the total curb achieved by OPEC's top producer Saudi Arabia is 574,000 bpd, well above the target cut of 486,000 bpd.
These increases offset lower supply in Iraq, which exported less crude from its southern terminals - and Venezuela, where exports also fell month-on-month, according to tanker data and shipping sources.
Output in the United Arab Emirates fell, but production in March was higher than originally thought. Lower output in Nigeria and Libya, which are exempt from the curbs, helped bring down overall OPEC production.
The Libyan and Nigerian reductions mean OPEC output in April averaged 31.97 million bpd, about 220,000 bpd above its supply target adjusted to remove Indonesia.
The Reuters survey is based on shipping data provided by external sources, Thomson Reuters follows data and information provided by sources at oil companies, OPEC and consulting firms.

 

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