Oil output falls, rebalancing in progress: OPEC
OPEC’s oil production fell by 79,100 barrels a day after rising for the last four months. The producer group has kept a lid on its output this year in a bid to drain a global glut of oil.
OPEC slightly raised its outlook for world oil demand and economic growth.
Production by the 14 members of the Organization of the Petroleum Exporting Countries came to 32.755 millions of barrels per day (bpd) last month after 32.834 in July, it said in a report, citing secondary sources.
OPEC and a number of other producers including Russia agreed in May to extend production cuts, originally agreed last year, into 2018 to ease a global supply glut and support the price of crude.
OPEC said that In August, production rose in Nigeria, which has been exempted from output curbs.
It fell in Libya, also exempt, and in Venezuela as both countries struggle with political trouble. Output also dropped in Iraq.
OPEC secretary general Sanusi Barkindo said in a speech in Oxford that it is clear that the rebalancing process is underway, supported by the high conformity levels of OPEC member countries and participating non-OPEC countries to the production adjustments” in the cooperation agreement.
OPEC meanwhile revised upwards its estimate for global oil demand by 1.42 million bpd to 96.77 million bpd this year. Demand is expected to rise by another 1.35 million bpd in 2018 as developed countries consume more oil than initially forecast.
The report said that Oil demand has been quite robust in 2Q17, particularly in the Americas and Europe.
Commenting on the impact on oil production of hurricane Harvey, OPEC said “the US energy industry appears to be rebounding quickly”.
Nevertheless, the advent of Irma raised the possibility of a particularly destructive hurricane season this year, “with potential implications for the oil market”, but OPEC promised to do its bit for the “stability and security” of the oil market.
Despite the efforts to cut output, the oil price has struggled to push durably above $50 a barrel.
On Tuesday, WTI oil futures stood at $48.22 and Brent Crude at $54.23.