En Español



Very usefull links



PW
Bookstore





News links

AP

AFP

Aljazeera

Dow Jones

Oil price

Reuters

Bloomberg

Views and News
from
Norway

 

 

 

 

Saudi Arabia return as the swing producer in oil

 


LONDON
Petroleumworld.com 02 02 2017

Saudi Arabia and its Gulf allies have accounted for almost all the production cuts delivered by OPEC so far as the kingdom resumes its familiar role as swing producer.

Saudi Arabia cut production by 564,000 barrels per day (bpd) in January, or 16 percent more than the 486,000 bpd reduction it pledged in November.

But the organization's members as a whole have cut output by just 958,000 bpd, or 18 percent less than promised cuts totaling 1.164 million bpd, according to the monthly Reuters survey.

As a result, Saudi Arabia has shouldered almost 60 percent of the output cuts so far, compared with a pledged share of just over 40 percent.

Saudi Arabia and its allies Kuwait, the United Arab Emirates and Qatar have contributed 82 percent of all the cuts made by the organization's members, compared with a planned share of 68 percent.

Compliance rates among other members of the Organization of the Petroleum Exporting Countries have generally been much lower (“OPEC oil output falls 1.07 million bpd in Jan”, Reuters, Jan 31).

Algeria and Venezuela have delivered just 18 percent of their promised cuts and Iraq's compliance has not been much higher at 24 percent.

Strictly speaking, the cuts are meant to be averaged across the first half of 2017 so no OPEC member has yet broken its promises.

Poor performers could still make deeper cuts in the months ahead to make up for the low level of compliance in January, though this seems unlikely.

OPEC has returned to its traditional behavior (“OPEC and other commodity cartels”, Alhajji and Huettner, 2000).

By cutting their own output deeply, Saudi Arabia and Kuwait have masked the low level of compliance across the rest of the organization.

Compliance excluding Saudi Arabia and Kuwait averaged just 50 percent in January.

The pattern of behavior is similar to 1999 when Saudi Arabia did most of the deliberate cutting, with some help from Kuwait and the United Arab Emirates.

Saudi Arabia and its allies have once again voluntarily cut output to reduce excess crude inventories and stabilize prices, leaving other members to produce as much as they can.



Story by John Kemp from Reuters

We invite all our readers to share with us
their views and comments about this article
.


Write to editor@petroleumworld.com


By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels

 

 

 

 

TOP

Contact: editor@petroleumworld.com,

Editor & Publisher:P.Ohep F. /Producer - Publisher:P.Ohep F./
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2016, Petroleumworld ™  / Elio Ohep Fitzgerald- All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.