Baku, Azerbaijan, June 7
By Leman Zeynalova – Trend:
OPEC crude oil production is expected to average 32.3 million barrels per day in 2017 and 32.8 million barrels per day in 2018, about 0.2 million barrels per day and 0.4 million barrels per day, respectively, lower than previously forecast, the US Energy Information Administration (EIA) said in its June Short-term Energy Outlook (STEO).
The lower forecast takes into account OPEC’s May 25 announcement regarding the extension of its production cuts.
On May 25, OPEC member countries and non-OPEC parties, Azerbaijan, Kingdom of Bahrain, Brunei Darussalam, Kazakhstan, Malaysia, Mexico, Sultanate of Oman, the Russian Federation, Republic of Sudan, and the Republic of South Sudan agreed to extend the production adjustments for a further period of nine months, with effect from July 1, 2017.
The reductions will be on the same terms as those agreed in November.
“The current forecast assumes OPEC’s cuts are extended beyond next March, but that non-compliance, which begins to grow in late 2017, increases somewhat in the second half of 2018,” said the report.
Without a further extension of the OPEC agreement, EIA would expect larger inventory builds in 2018 than are included in this forecast.
EIA’s OPEC production figures this month do not include Equatorial Guinea, which joined OPEC on May 25. EIA will include Equatorial Guinea in OPEC starting in the July 2017 STEO.
---
Follow the author on Twitter: @Lyaman_Zeyn