Organization of Petroleum Exporting Countries (OPEC) crude oil production fell in March to the lowest since April 2017 as a result of declining Angolan exports, Libyan outages and a further slide in Venezuelan output, thus increasing compliance with a supply-cutting deal by the oil producers to another record.
OPEC pumped 32.19 million barrels per day last month, a Reuters’ survey found, down 90,000 bpd from February and in March the lowest in 11-month.
Under a pact that started in January 2017 and runs until the end of 2018, OPEC is reducing output by about 1.2 million bpd as part of a deal with Russia and other non-OPEC producers to get rid of excess supply.
Nigeria and Libya were originally exempt from cutting supply because their output had been curbed by conflict and unrest. For 2018, both told OPEC that output would not exceed 2017 levels.
OPEC has an implied production target for 2018 of 32.73 million bpd, based on cutbacks detailed in late 2016 and taking into account changes of membership since, plus Nigeria and Libya’s expectations of 2018 output.
Compliance by producers to the deal rose to 159 per cent of agreed cuts from 154 per cent in February, and there was no sign that other producers had boosted output to cash in on higher prices or to compensate for the Venezuelan decline.
Oil has topped $71 a barrel this year for the first time since 2014, and was trading above $67 yesterday Thisday cited.
But OPEC said supply restraints should be maintained to ensure the end of a glut that had built up since 2014.
In March, the biggest decrease in supply caused by natural declines at some oilfields, came from Angola, which exported 48 cargoes, two fewer than in the same month of 2017.
Production in Libya, which remains unstable due to unrest, slipped because of stoppages at two fields, El Feel and El Sharara, setting back 2018’s partial recovery in output.