OPEC crude production declines further in April

Oil production from Organization of Petroleum Exporting Countries (OPEC) averaged average 31.73 million barrels per day (bpd) in April, down 18,000 bpd from the previous month, the agency said in its latest monthly oil market report.

Production declined in the United Arab Emirates, Libya, Iraq and Iran, but increased in Angola and Saudi Arabia, it said.

Saudi Arabia’s output, according to secondary sources, rose to 9.95 million bpd – above March reading of 9.9 million bpd, but below the Kingdom’s production cap of 10.06 million bpd.

The OPEC supply is forecast to average 6.22 million bpd, an upward revision of 40,000 bpd from last month’s estimates and a 170,000 bpd over the previous year.

The group expects the demand for its crude to average 31.9 million bpd in 2017, which is 200,000 bpd from last year but down 300,000 bpd from last month’s forecast on expectations that output from non-member producers will rise even as world oil demand is likely to remain unchanged.

Supply from non-OPEC producers is estimated to rise to 58.25 million bpd in 2017, representing a year-on-year growth of 950,000 bpd, driven by higher production from the US and Canada.

In April, non-OPEC oil supply dropped by 440,000 bpd from March due to lower production from Russia and China, the report said.

OPEC and other major exporters, including Russia, have been reducing supply as part on an output deal that aims to rebalance global oil market.

The six-month deal came in to effect on January 1. The participating states are now considering whether the deal should be extended.

A formal decision on the extension will be made when OPEC and non-OPEC members meet in Vienna on May 25. 

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com