OPEC Monitoring Committee to assess inventories and compliance with oil cuts


Caracas, 16 Mar. AVN.- The ministerial monitoring committee, meeting next week in Kuwait, will discuss the recent increase in crude inventories and the impact of the oil supply cut agreement that came into effect this year, said Venezuela's Oil Minister, Nelson Martinez, on Wednesday.

He warned that in recent days "there has been an imbalance in prices" caused, in particular, by the increase of inventories in the United States, reason why this subject will be discussed at the meeting scheduled for March 26.

"There is a correlation between inventories and prices. This is going to be one of the main issues at the next meeting," Martinez told reporters at the PDVSA headquarters in Caracas.

He said the Monitoring Committee, which includes Venezuela, Russia, Oman, Kuwait and Algeria, is observing very closely the implementation of output cut agreement.

"The proposal is to join other countries to make a call to voluntarily contribute to bring down production or set a ceiling to be sure that the increase of inventories is controlled," he added.

He said that OPEC's monthly report revealed "a greater commitment to the stability of the oil market by the OPEC and non-OPEC agreement."

The oil bloc reported that in February, member countries' production stood at 31.96 million barrels per day, representing a decrease of more than 1 million barrels, compared to 33 million barrels it averaged in 2016.

The meeting in Kuwait will serve as a prelude to the Organization of Petroleum Exporting Countries (OPEC) ministerial meeting scheduled for the third week of May.

In its March report, OPEC warned that producers outside the group will increase their production this year by 400,000 barrels per day, to account for 57.74 million barrels per day, representing a total of 160,000 barrels more than the figure recorded in February.

"This forecast is driven mainly by higher expectations for Canadian oil sands output and higher growth in the US," the cartel said Tuesday in its website.

It also notes that rising prices, improvements in drilling efficiency, and well productivity in North America affect the recovery of oil supplies in the international oil market.

OPEC, which was created in 1960, has 13 member countries (Algeria, Angola, Ecuador, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates, and Venezuela) exporting about 30% of global oil demand, and they own 80% of the world's proven oil reserves.

16/03/2017 - 03:24 pm