Baku, Azerbaijan, April 28
By Aygun Badalova - Trend:
OPEC remains relevant to the rebalancing of the oil market, the analysts of the US JP Morgan bank believe.
"However, it remains seemingly hobbled by its inability to update historic quota allocations. Those members who hold quotas in excess of current output appear unwilling to cede their rights in order to put OPEC on a sustainable footing," analysts said in a report, obtained by Trend.
They believe, that Initiatives, such as the Doha producer negotiations could in time achieve both an equitable split of the burden of managing supply and involve producers within and outside of OPEC, thereby achieving two of the key requirements that they think are necessary for success.
The last meeting of oil producers in Doha ended without reaching any agreement. The talks on oil output freeze collapsed after Saudi Arabia surprised the group by reasserting a demand that Iran also agrees to cap its oil production.
JP Morgan's analysts believe that despite reports of renewed efforts to restart these negotiations, nothing concrete to emerge in advance of the OPEC meeting on 2 June.
OPEC's total oil output was 32.25 million barrels a day in March 2016, which is by 15,000 barrels more than in February, according to OPEC's recent report. The official quota for the OPEC oil output is 30 million barrels per day.
JP Morgan's analysts expect OPEC oil production to further rise reaching 32.9 million barrels per day in 2016 and 33 million barrels per day in 2017, with Saudi Arabia's oil output to be at 10.3 million barrels per day in both years.