Baku, Azerbaijan, August 16
By Leman Zeynalova – Trend:
OPEC member compliance with agreed production cuts will fade over the course of the second half of 2017, according to the forecasts of the US JP Morgan bank.
“More positive overtures from the Saudi Arabian and Iraqi Energy Ministers on their respective commitments to the agreed cuts helped bolster market sentiment on the outlook for prices. Previous comments from Jabbar Al-Luaibi, in mid-July, offered the prospect of Iraq increasing output to 5 million barrels per day by the end of this year, some 65,000 barrels per day over its production target. It is hard to reconcile both stated aims of the Iraqi government, but our assumption remains that OPEC member compliance with agreed production cuts will fade over the course of 2h’17,” said the analysis obtained by Trend.
The analysts believe that oil prices will soften in 2018.
Despite increased rhetoric by Saudi Arabia and other OPEC members there appears limited appetite for additional production cuts, said JP Morgan.
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.
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