OPEC stresses need for 2019 oil supply cuts as rivals pump more
The Organization of the Petroleum Exporting Countries (OPEC) cut the forecast of global demand for its crude this year as rivals boost production, building a case...
The Organization of the Petroleum Exporting Countries (OPEC) cut the forecast of global demand for its crude this year as rivals boost production, building a case to extend a supply-cutting deal with Russia and other allies beyond the first half of 2019.
In a monthly report, OPEC report said 2019 demand for its crude would average 30.46 million barrels per day, 130,000 bpd less than forecast last month and below what it is currently producing.
OPEC, Russia and other non-OPEC producers, an alliance known as OPEC+, agreed in December to reduce output by 1.2 million bpd from Jan. 1 to prevent excess supply building up. The cut lasts for six months initially.
"While oil demand is expected to grow at a moderate pace in 2019, it is still well below the strong growth expected in the non-OPEC supply forecast for this year" OPEC said in the report.
"This highlights the continued shared responsibility of all participating producing countries to avoid a relapse of the imbalance and continue to support oil market stability in 2019."
OPEC sources have said an extension of the supply-cutting pact beyond June is the likely scenario. The group and its allies are due to meet in April and June to discuss policy.
Saudi Arabia's Energy Minister Khalid al-Falih stated that the Organization of the Petroleum Exporting Countries (OPEC) and other major oil producers need to continue moderating the crude production in the second half of this year in order to stabilize the oil market. Speaking in an interview with CNBC, the official added that it is "difficult to predict where we will be in June when interim agreement runs out."