OPEC breaks own record as compliance to oil deal hits 106%

June 22, 2017 8:52 pm

The Organisation of Petroleum Exporting Countries (OPEC) has beat its own oil cut compliance record, which stood at 104 percent as at April 2017.

According to the joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC), for the month of May 2017, OPEC and participating Non-OPEC producing countries recorded the highest conformity ever with their voluntary adjustments in production, achieving a level of 106%.

The JMMC was established following OPEC’s 171st ministerial conference decision of November 30 2016, and the subsequent Declaration of Cooperation made at the joint OPEC-Non-OPEC producing countries’ ministerial Meeting held on 10 December 2016 at which 11 non-OPEC oil producing countries cooperated with the 13 OPEC Member Countries in a concerted effort to accelerate the stabilization of the global oil market through voluntary adjustments in combined production of around 1.8 million barrels per day.

The resulting declaration, which came into effect on January 1, 2017, is for six months, and is extendable for an additional six months, depending on the status of supply and demand, including global inventories.

The second joint OPEC-Non-OPEC Producing Countries’ Ministerial Meeting, held on 25 May 2017, decided to extend the voluntary production adjustments for another nine months commencing 1 July 2017.

The JMMC expressed great satisfaction that overall conformity levels by OPEC and participating non-OPEC producing countries have steadily increased from January to May 2017, exceeding 100% in both April and May to reach its highest level since January 2017.

In May 2017, the OPEC and participating non-OPEC producing countries achieved a conformity level of 106 per cent, an increase of 4 percentage points over the April 2017 performance.

This is a convincing demonstration of the willingness of all participating countries to continue their cooperation until the set goal is achieved.

“The JMMC took note of the recent market development and expressed confidence that the oil market is moving in the right direction towards the achievement of the objectives of the Declaration of Cooperation, and further encouraged all participating countries to press on towards full conformity and maintain this level for the benefit of producers and consumers alike, as has been consistently advocated,” OPEC said via a statement.

The next JMMC Meeting is scheduled to be held in St. Petersburg, Russia, on July 24, 2017.