OPEC output falls as Gulf nations step up delivery of oil cuts
Organisation of Petroleum Exporting Countries’ (OPEC) output declined in December 2019 as several Arabian Gulf producers stepped up their implementation of cutbacks aimed at balancing global oil markets.
The UAE, Saudi Arabia and Iraq reduced production in December 2019, the final month of a round of restrictions by the cartel before it presses on with new—and even deeper—curbs this year.
Bloomberg reported that output from OPEC fell by 90,000 barrels a day to 29.55 million in December 2019.
The campaign by OPEC and its allies to tighten supplies shored up global crude markets in 2019, pushing Brent prices up 23 per cent despite a flood of new American shale oil and fragile fuel demand around the world. The coalition agreed earlier in December 2019 to deepen its curbs to prevent a new surplus forming in Q1 2020.
Saudi Arabia, OPEC’s biggest member, is already making strides toward its new target. With 9.83 million barrels a day of production, the Kingdom has cut more than twice the amount pledged under last year’s deal and is well on its way to the new, self-imposed quota of 9.7 million barrels.
Similarly, the UAE curbed more than required under the expiring accord, trimming by 60,000 barrels a day to 3.04 million.
Iraq also fulfilled its commitments by cutting 60,000 barrels a day in December, but with an overall production rate of 4.65 million a day it’s only just down to the starting point for last year’s cutbacks.
Russia, the biggest producer in the OPEC+ alliance, has similarly shown a mixed performance. Its output of crude and condensate hit a post-Soviet high last year despite pledges to reduce, as Moscow proffered a succession of reasons why it could not fully implement the agreed curbs.
Source: CPI Financial