• 3 minutes Nucelar Deal Is Dead? Iran Distances Itself Further From ND, Alarming Russia And France
  • 5 minutes Don Jr. Tweets name Ukraine Whistleblower, Eric Ciaramella. Worked for CIA during Obama Administration, Hold over to Trump National Security Counsel under Gen McCallister, more . . . .
  • 9 minutes Shale pioneer Chesepeak will file bankruptcy soon. FINALLY ! The consolidation begins
  • 12 minutes China's Blueprint For Global Power
  • 6 mins EU has already lost the Trump vs. EU Trade War
  • 1 day Crazy Stories From Round The World
  • 1 day Science: Only correct if it fits the popular narrative
  • 1 day Iran Burning: Shock Gas Price Hike Triggers Violent Protests After Subsidy Cuts
  • 1 day Everything You Need To Know About Trump
  • 8 hours Pope Proposes New Sin: Thou Shalt Not Destroy The Harmony Of The Environment
  • 15 hours IEA predicts oil demand will grow annually at 1 million barrels a day for the next 5 years
  • 2 days Atty General Barr likely subpeona so called whistleblower and "leaker" Eric Ciaramella
  • 10 mins Water, Trump, and Israel’s National Security
  • 17 hours ‘If it saves a life’: Power cut to 1.5 million Californians
  • 1 day Impeachment Nonsense
  • 2 days What are the odds of 4 U.S. politicians all having children working for Ukraine Gas Companies?
  • 2 days Do The World's Energy Policies Make Sense?
Rystad Energy

Rystad Energy

Rystad Energy is an independent oil and gas consulting services and business intelligence data firm offering global databases, strategy consulting and research products. Rystad Energy’s…

More Info

Premium Content

OPEC Came Up Short – Here’s What They Should Do

OPEC+ will need to stay 700,000 bpd below its agreed targets of 31.8 million bpd through 2019 in order to bring a recovery in Brent prices to the $70 level, Rystad Energy says.

The OPEC countries and Russia agreed on December 7 to cut oil production by 1.2 million bpd in 2019 – slightly larger than the 1.0 million bpd cut expected by many observers.

“The OPEC+ agreement predictably came up short of what Rystad Energy argued would be required to fully balance the market in 2019. The agreed production cuts will not be enough to ensure sustained and immediate recovery in oil prices. The muted market reaction seen thus far comes as no surprise to us”, Rystad Energy head of oil market research Bjornar Tonhaugen says.

(Click to enlarge)

Rystad Energy, the independent energy research and consultancy headquartered in Norway with offices around the world, provides comprehensive and up-to-date insight into global oil markets. In a note to clients, Tonhaugen writes:

• The agreed OPEC+ production cuts will not be enough to ensure sustained and immediate recovery in oil prices
• The decision does stand as a Christmas gift to budget-setters in the US shale industry, where the relentless growth in production is set to continue also for the second half of 2019 and beyond
• OPEC+ succeeds in preventing massive over-supply in the first half of 2019 and in putting a soft floor under oil prices for now
• If production cuts by OPEC and Russia are extended through 2019, the market can balance

(Click to enlarge)

“Most likely, OPEC will be forced to conduct production management sporadically over the next few years, unless US shale supply grows even faster than we currently expect. OPEC members have their work cut out for them in the years to come”, Tonhaugen says.

By Rystad Energy

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage



Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play