In the latest round of OPEC promises, Kuwait's state run oil company has pledged to cut "contractual sales volumes of oil for 2017" according to Bloomberg Markets. Kuwait Petroleum Corporation made the announcement just one day after fellow OPEC member UAE promised to cut its own oil exports by 10 percent starting in February, and just two days after OPEC conductor Saudi Arabia promised to curb oil exports starting in August.
The renewed OPEC vows to chip in towards doing "whatever it takes" to rebalance the oil markets comes just days after Saudi Arabia chastised members for not adhering to the OPEC agreement. The United Arab Emirates, for example, failed to comply with the deal even a single month so far during the collective agreement to cut out 1.2 million barrels of oil production.
Kuwait's compliance, on the other hand, has been much higher. And now that it has for the most part complied with the OPEC deal, the next logical step is the subsequent drop in oil exports.
While yesterday's announcement by the UAE will have the most impact on its largest customer, Japan, Kuwait's export curbs will have the most affect the United States, according to an emailed statement, citing Emad Al-Abdulkarim, acting managing director of global marketing at KPC.
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With promises of lowered oil exports to the United States from both Saudi Arabia and now Kuwait, the United States may very well look towards Iraq, who increased oil exports to the US substantially in June as Saudi Arabia's crude oil exports to the US plummeted.
Iraq, OPEC's second largest oil exporter, should have little trouble in taking over for OPEC's #1, Saudi Arabia, and Kuwait when it comes to exports to the United States, as Iraqi announced its plans earlier this week-much to OPEC's chagrin-to increase its 2017 crude oil production to 5 million bpd. Iraq's production threshold under the OPEC agreement is 4.351 million barrels per day.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More