• 4 minutes Energy Armageddon
  • 6 minutes "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 12 minutes "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 13 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 1 day Is Europe heading for winter of discontent with extensive gas shortages?
  • 14 hours "False Flag Planted In Nord Stream Pipeline, GFANZ, Gore, Carney, Net Zero, U.S. Banks, Fake Meat, and more" - NEWS in 28 minutes
  • 7 days Wind droughts
  • 21 hours ""Green" Energy Is a Scam. It Isn't MEANT to Work." - By James Corbett of The Corbett Report
  • 21 hours "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 4 days Kazakhstan Is Defying Russia and Has the Support of China. China is Using Russia's Weakness to Expand Its Own Influence.
  • 3 days Xi Is Set To Be Re-Elected As China’s Leader
  • 8 days Oil Prices Fall After Fed Raises Rates
  • 10 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 3 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 13 days Beware the Left's 'Degrowth' Movement (i.e. why Covid-19 is Good)
Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

Has OPEC Reached Its Real Output Cut Goals?

OPEC production estimates from a couple of surveys are in and they suggest the cartel, despite its best efforts, has not been completely successful in its efforts to drive prices higher. Instead, it kept its production relatively stable last month, which has acted as a cap on international prices.

Reuters and Bloomberg both reported OPEC production figures for March yesterday, with both figures suggesting a relatively stable rate. The Reuters survey estimated a 90,000-bpd decline in overall production across the organization, with Venezuela and Iran, as usual, the ones that drove the total down, helped by Saudi Arabia and its Gulf partners, who continued cutting production under their OPEC+ deal obligations. The Reuters survey pegged the average daily for March at 30.23 million barrels.

Bloomberg’s survey of data yielded a pretty close figure for the March total, at 30.3 million bpd, although it estimated this was 25,000 bpd higher than in February. Interestingly and perhaps contrary to expectations, one of the contributors to this estimated increase was Libya: one of the most unstable members of OPEC, and one that has been exempted from the cartel-wide cuts, managed to boost its production last month by resuming full production at its largest field, Sharara.

Iran’s oil production, according to the Bloomberg survey, fell by 80,000 bpd to 2.63 million bpd last month and Angola also booked a decline in its output, of 60,000 bpd. Venezuela’s output continued to decline, according to earlier data from TankerTrackers.com and from Reuters. Libya’s production, however, rose by 90,000 bpd, more than offsetting the Iran decline. Related: High-Cost Oil Faces Existential Risk

Saudi Arabia, OPEC’s largest producer, however, is arguably the main factor in the oil price game. The country has been cutting more than it agreed to in a bid to push prices even higher. At the same time, Riyadh, in the face of Energy Minister Khalid al-Falih, has assured President Donald Trump in response to his calls for lower prices that it is ready to reverse the cuts whenever this becomes necessary. These assurances has served to keep a lid on prices after the U.S. State Department announced the end of sanction waivers for Iran’s biggest oil clients, effectively betraying Saudi Arabia’s purpose of pushing prices close to US$80 a barrel.

OPEC seems to have turned into one big wild card. While Saudi Arabia can keep its Gulf neighbors—except Qatar—in line and tweak production in accordance with their priorities, the rest of the large producers in the group are not so reliable. Besides Iran, Venezuela, and Libya, which are all exempted from the cuts and as such capable of surprises, there are also large producers such as Iraq and Nigeria, which both have plans to boost their production significantly and are eager to begin implementing them.

Just a few weeks ago the dominant talk in oil was whether the OPEC+ cuts would be extended to keep prices higher. There is still a chance for that but with so much uncertainty within OPEC itself and the newly increased competition pressure from U.S. oil, the discussions to take place later this month when OPEC+ meets will certainly be interesting. For traders, times will also continue to be interesting, it seems.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News