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The
Organization of the Petroleum Exporting Countries is curbing its
output by about 1.2 million barrels per day (bpd) from Jan. 1,
the first cut in eight years. Russia and 10 other non-OPEC
producers agreed to cut half as much.
But in its monthly report OPEC said oil stocks in industrialized
nations rose in January to stand 278 million barrels above the
five-year average, of which the surplus in crude was 209 million
barrels and the rest products.
"Despite the supply adjustment, stocks have continued to rise,
not just in the U.S., but also in Europe," OPEC said in the
report.
"Nevertheless, prices have undoubtedly been provided a floor by
the production accords."
In the report, OPEC pointed to a increase in compliance by its
members with their deal to cut output from Jan. 1.
Supply from the 11 OPEC members with production targets under
the deal fell to 29.681 million bpd last month, according to
figures from secondary sources that OPEC uses to monitor its
output.
That means OPEC has complied by more than 100 percent with its
plan to lower output for those nations to 29.804 million bpd,
according to a Reuters calculation. OPEC didn't give a
compliance figure in the report.
But the report revised up its estimate of oil supply from
producers outside OPEC this year, as higher oil prices following
the OPEC and non-OPEC cut help spur a revival in U.S. shale
drilling.
Production outside OPEC is now expected to rise by 400,000
barrels per day (bpd), 160,000 more than previously thought.
U.S. oil output in 2017 was revised up by 100,000 bpd.
While the OPEC secondary sources said Saudi output fell in
February, Saudi Arabia reported to OPEC that it increased.
(Reporting by Alex Lawler, editing by Louise Heavens and David
Evans)
(Reporting by Alex Lawler, editing by Louise Heavens)
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