The world oil market can go from a surplus to a deficit in 2017, if the OPEC agreement achieved in Algiers is implemented, according to the International Energy Agency (IEA).
OPEC plans to reduce the cartel’s production to the level of 32.5-33 million barrels a day, IEA says in its November report. At the same time, the agency recognizes that if any of the OPEC countries continues to increase production, then throughout 2017 the excess supply in the market will continue and the chances of a significant increase in oil prices will be little.
According to OPEC, in October 2016 world oil production has increased compared to October of last year by 0.8 million barrels per day.
Despite the decline in production in non-OPEC, the effect of this is offset by continued growth in production in the cartel. In October, according to IEA, it reached a record 33.83 million barrels per day, an increase of 1.3 million barrels compared with last October.
Within the framework of OPEC production has been increasing for the fifth consecutive month. IEA reports production growth recovery in Nigeria and Libya and increase in production to record levels (4.59 million barrels a day) in Iraq.
IEA points to production growth in exporting countries outside the cartel – Russia, Canada, Kazakhstan, and Brazil. In 2017, the agency predicts production growth in these countries by 0.5 million barrels per day.
In October, Russia’s oil production was 11.2 million barrels – a maximum of 25 years.
