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In a recent video, Ernest Scheyder reported that a top priority for discussion at OPEC’s meeting in Vienna will be the stalling of OPEC’s initiative to swing inventories back to their five year average. The reason they have stalled is in part due to the outpouring of U.S. oil production.
In the OPEC’s May 11 2017 Monthly Oil Market Report, expectations for the nation’s shale oil production were revised at a substantially higher rate. The oil supply estimated forecast has now been increased to 14.45 million barrels per day (increasing the total amount for 4Q17 to 14.96 million barrels).
Numbers from the International Energy Agency show that inventories from industrialized countries had a total of 3.05 billion barrels in February which was around 330 million barrels above the five year average. In addition, earlier this week saw the agreement (in principle) between Saudi Arabia and Russia for a need to continue output cuts for another nine months until March 2018. Further, American oil output increased to 9.31 million bpd this year, (a jump of 440,000 bpd from last year).
