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Will The U.S.-Saudi Spat Upend Oil Markets?

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Saudi Arabia appeared to threaten…

Oman Targets 1 Million Bpd Oil Output In 2017

Oman oil tanker

Non-OPEC producer Oman intends to pump an average of 1 million bpd this year, despite the 45,000 bpd production cut it had pledged with the OPEC-non-OPEC deal, a senior official at the oil and gas ministry said on Monday.

“Production-wise, we are going to maintain the one million barrels per day. Our share in production cut is 45,000 barrels a day and we have already started reducing the production. But we see this as a short-term (phenomenon),” local media quoted oil ministry undersecretary Salim Al Aufi as saying at an event.

Oman was part of the group of 11 non-OPEC producers – including Russia - that had agreed to act jointly with the cartel to cut oil supply. The non-OPEC countries had pledged a total production cut of 558,000 bpd.

Last year, Oman’s production exceeded for the first time the average of 1 million bpd, namely 1,004,300 bpd—an increase of 2.6 percent, Times of Oman reports, quoting data by the National Centre for Statistics and Information (NCSI).

In the first six months of this year - the initial period in which the production cuts are in force - Oman’s target production is 970,000 bpd, the ministry official said. After June, the country can go back to its original production target, pending any extensions of the agreement.

Related: Oil Prices Could Reach $60 This Year: Novak

Oman will boost its oil and natural gas producing capacities, according to Al Aufi.

Referring to the oil supply cuts, the Omani official said that all oil exporting countries, including OPEC, have already cut back 1.5 million bpd, compared to the commitment to reduce output by 1.8 million bpd.

Al Aufi’s view of the cuts so far is exactly the same estimate that Saudi Arabia’s Energy Minister Khalid al-Falih gave last week. At the World Economic Forum in Davos, al-Falih said that there had been “very strong compliance” by OPEC and non-OPEC oil countries to the production cuts, and that the producers had gone “extra miles”, with the majority exceeding their commitments.

By Tsvetana Paraskova for Oilprice.com

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