• 4 minutes US-backed coup in Venezuela not so smooth
  • 7 minutes Why Trump will win the wall fight
  • 11 minutes Oil imports by countries
  • 13 minutes Maduro Asks OPEC For Help Against U.S. Sanctions
  • 3 hours Climate Change: A Summer of Storms and Smog Is Coming
  • 4 hours Venezuela: Nicolas Maduro closes border with Brazil
  • 1 hour Tension On The Edge: Pakistan Urges U.N. To Intervene Over Kashmir Tension With India
  • 58 mins Teens For Climate: Swedish Student Leader Wins EU Pledge To Spend Billions On Climate
  • 2 hours The Quick Read On MBS's Tour of Pakistan, India And China
  • 3 hours Iran Starts Gulf War Games, To Test Submarine-Launched Missiles
  • 2 hours BMW to add 2,000 more jobs at Dingolfing plant
  • 19 hours Itt looks like natural gas may be at its lowest price ever.
  • 5 hours Saudi A to Splash $100 Bln on India
  • 21 hours Amazon’s Exit Could Scare Off Tech Companies From New York
  • 13 hours NEW FERUKA REFINERY
  • 6 hours Washington Eyes Crackdown On OPEC
Alt Text

An Underestimated Niche In Oil & Gas

Decommissioning obligations in the global…

Alt Text

Rising Energy Demand Could Be A Boon For The Philippines

The private sector is accelerating…

Alt Text

US Drillers See Modest Rise In Oil Rigs As Prices Hold

Baker Hughes reported an increase…

Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing for news outlets such as iNVEZZ and…

More Info

Trending Discussions

OPEC Deal Not Enough To Draw Down Record Oil Inventories

Even if OPEC producers’ ministers hail the cartel’s deal to cut collective supply as the beginning of oil market rebalancing and stabilization, Bloomberg News has calculated that global oil stockpiles would be little reduced throughout the entire 2017.

According to Nigeria’s Minister of State for Petroleum Emmanuel Kachikwu, the global oil market would rebalance “toward the middle of next year,” Bloomberg said.

However, analysts are not so optimistic.

Tamas Varga, analyst at brokerage PVM Oil Associates Ltd. in London, commented, “Even with 100 percent compliance from both OPEC and non-OPEC producers, global stocks are unlikely to fall in the first half of 2017.”

Last week OPEC pledged to cut the cartel’s total production to 32.5 million bpd as of January, but made the deal contingent on convincing non-OPEC producers to cut another 600,000 bpd.

OPEC and NOPEC representatives are meeting in Vienna on Saturday to discuss cooperation on production cuts. As we go into the meeting, so far only Russia among the non-OPEC members has pledged a cut, by a gradual 300,000 bpd reduction over the first half of 2017.

Oman, another non-OPEC nation, is also seemingly on board, saying it would announce cuts after the meeting, and indicating prior to the OPEC deal that it might be willing to cut 5-10 percent.

Russia, Mexico, Kazakhstan, Azerbaijan, and Oman are the only countries —out of 14 non-OPEC producers invited to the talks—that have confirmed they would attend tomorrow’s meeting.

Still, concerns are that OPEC members will cheat, Russia would rename its seasonal spring production suspension as its ‘gradual cut’, and Mexico, Azerbaijan and Colombia would wrap up natural declines in production as genuine cuts. Related: Oil Markets Not Convinced OPEC Deal Can Kill The Glut

According to Bloomberg, OPEC’s track record shows that the cartel delivers 80 percent of pledged cuts.

People familiar with the talks told Bloomberg that OPEC may be ready to accept other non-OPEC producers dressing up natural declines as cuts, but only if Russia made a legitimate production cut.

Should OPEC get in its good old ways and deliver 80 percent of the cuts it had pledged, then it would need non-OPEC producers to slash a total of 600,000 bpd of production—legitimately—so that oil oversupply could draw down in 2017.

“We don’t think too many non-OPEC countries actually have the power and will and influence over the oil companies to actually hold back barrels,” Per Magnus Nysveen, senior partner and head of analysis at Rystad said, as quoted by Bloomberg.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage

Trending Discussions


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News