OPEC Sees Plummeting Venezuelan Output Offsetting Rising US Production

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Rival suppliers would be handed the entire 1.3 million barrel-a-day expansion in the global oil market this year, and USA crude output could overtake that of Saudi Arabia and even get close to Russia, IEA data show.

In September 2016, US shale oil production fell to a multiyear low of 4.11 million barrels a day in, but it has climbed by 920,000 barrels a day to more than 5 million barrels a day last November. Earlier this week, Brent crude futures hit $70.37 per barrel with the oil benchmark at $68.49 on Friday morning.

"This year promises to be a record-setting one for the US", it said.

Several analysts have also predicted United States oil output to break through 10 million barrels per day soon.

After adding in barrels from Brazil, Canada and other growth countries, and allowing for falls in Mexico, China and elsewhere, total non-OPEC production will increase by 1.7 million barrels per day (bpd), IEA said in its latest world oil market report. The production cuts by OPEC and 10 other allied producers, which are scheduled to last throughout 2018, are aimed at clearing a supply overhang and propping up prices.

For now, the extra crude from the U.S.is meeting growing demand as the world economy expands at a strong pace. "We have agreed earlier and agreed today that this format of cooperation between OPEC and non-OPEC countries can be used as a consultations format after the deal is over", he said.

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

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OPEC's warning and higher output estimates for non-members underlines the continuing report fears by big producer nations that the current rebound in prices - which - could trigger a flood of new U.S. supply, undermining efforts by global producers to curb output.

This is the second month running in which OPEC increased its forecast for rival oil supply growth; but balancing its figures was a high compliance rate of 129 percent with regards to the cartel's cutback strategy in December (meaning, more crude was taken off the market), as well as a drastic decline in production from Venezuela, whose economy has always been teetering on the brink of complete collapse.

It added that percent represents 1.57 million barrels per day (mbpd).

"What we are trying to understand is the responsiveness of the U.S. shale producers".

In OPEC's monthly oil market report, the organisation revised its forecast for non-OPEC supply growth in the year ahead.

Formal U.S. data on supplies is published midway through the morning by the Energy Information Administration.

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.

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