Saudi to possibly extend cooperation with global oil suppliers beyond 2018

Saudi to possibly extend cooperation with global oil suppliers beyond 2018

A decrease in production from Venezuela and turmoil in the Middle East OPEC countries has allowed the U.S.to become a major energy benefactor for oil-consuming nations.

The total volume of global production increases by 42,000 barrels per day to 34.42 million barrels per day.

A plunge in Venezuelan supply cut OPEC crude output to 32.23 million bpd in December, boosting compliance to 129 percent.

Commercial stockpiles in the Organisation for Economic Co-operation and Development countries declined for the fourth consecutive month in November, by 17.9 million barrels.

According to data from secondary resources, the OPEC remains more than compliant with the agreement on an average production basis. Prices are close to the highest since December 2014.

"Supply growth overshadowing demand growth should be the main topic for the energy market in 2018", the bank said.

With the opening of the Forcados terminal, crude oil exports rose to 1.93 million barrel in September and Nigeria was brought into the supply cap deal when OPEC and non-members met on November 30. With the sharp increases in domestic production, the US may see itself as the world's top oil producer going into 2020.

Despite a plunge in USA commercial crude inventories, oil prices slipped to settle at $63.95 a barrel in NY, down 2 cents, as traders resurrected an old, but persistent concern that increasingly efficient shale drillers will ramp up output and overwhelm OPEC's efforts to curb production.

Saudi Arabia has invested in a number of huge refineries in recent years in order to meet growing domestic demand and sell product overseas as it takes advantage of its large crude resources.

The U.S. Energy Department reported that oil reserves fell by 6.86 million barrels last week.

"The demand side of the equation is keeping us well-healed", said Phil Flynn, analyst at Price Futures Group in Chicago, who expects oil demand to hit between 1.8 million bpd to 2 million bpd.

Mumbai: Even as analysts and fund managers expect corporate earnings to recover later this year, rising crude oil prices could bite into the margins of some companies. Oil prices are now at levels at which USA production could substantially increase.

Higher prices may yet clip the wings of the oil demand growth that Opec and friends need. We expect to see a steady yet moderate growth in the United States output over the coming months.

Mr. Falih pointed to weaknesses in the deal, saying the first OPEC-led output cuts in nearly a decade had yet to instill enough confidence in the oil industry for investment in expensive projects. As a result, the oil market will return to balance in 2018, he said.

The group and partners including Russian Federation will meet this weekend in Oman to review their strategy for clearing the global oil glut.

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