OPEC crude output was 930,000 barrels per day (b/d) lower in January at 30.83 million barrels per day (mb/d), a near four-year low, Trend reports citing the Oil Market Report released by the International Energy Agency (IEA).
Compliance with the Vienna Agreement was 86 percent, with Saudi Arabia, the United Arab Emirates (UAE) and Kuwait cutting by more than promised, reads the report.
This is while compliance by non-OPEC participants was only 25 percent, says IEA.
Global supply fell 1.4 mb/d to 99.7 mb/d in January as the Vienna Agreement and Alberta's cuts took effect, reads the report.
“Our non-OPEC growth estimates have increased to 2.7 mb/d in 2018 and to 1.8 mb/d in 2019. This is mainly due to higher US output,” said IEA.
So far, IEA believes there are no signs that other producers, e.g. Saudi Arabia, are intending to push more barrels into the market to offset shortfalls.
“Oil prices have not increased alarmingly because the market is still working off the surpluses built up in the second half of 2018, when global supply is estimated to have exceeded demand by 1.3 mb/d. In quantity terms, in 2019 the US alone will grow its crude oil production by more than Venezuela's current output. In quality terms, it is more complicated.”
On December 7, 2018, an agreement was reached at the fifth ministerial meeting of the non-OPEC member and non-OPEC countries in Vienna to cut daily oil production by 1.2 million barrels.
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