Eleven non-OPEC oil producers that joined a global deal to cut output to boost prices have delivered at least 60% of promised curbs so far, OPEC sources said Feb. 22, higher than initially estimated.
OPEC, Russia and other producers agreed to cut production by 1.8 million barrels per day (MMbbl/d) from Jan. 1 to boost prices and get rid of a supply glut.
Compliance numbers were reviewed at a meeting in Vienna on Feb. 22 comprised of officials from countries monitoring adherence to agreed output levels—OPEC members Kuwait, Venezuela, Algeria plus non-OPEC Russia and Oman. OPEC President Saudi Arabia also attended.
"This meeting shows the seriousness of OPEC and non-OPEC in implementing the agreed cut," an OPEC delegate said. Two OPEC delegates said compliance by Russia and the other 10 nations, according to OPEC calculations, was now estimated at 66%, while a third said it was 60% at least. This is up from earlier estimates of 40%.
The meeting also discussed OPEC's own compliance, which in January was estimated at more than 90% by government agencies, consulting firms and industry media—a record level, according to the International Energy Agency.
The lower compliance figure for non-OPEC to date is partly due to the phased implementation of the deal by Russia, the largest non-producer cooperating with OPEC.
Russia said it would phase in its share of the cut gradually rather than in the first month of the agreement and in January lowered supply by 100,000 bbl/d. Moscow pledged in the agreement to reduce output by 300,000 bbl/d.
The panel, which met at OPEC's headquarters in Vienna on Feb. 22, is called the joint technical committee (JTC). It was established last month as part of efforts to monitor adherence to the supply cut.
Top OPEC producer Saudi Arabia is also a member of the JTC in its capacity as OPEC president in 2017.
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