Compliance monitoring meeting at Vienna shows OPEC, allies exceeding promised reductions, says Novak

At the first meeting of a joint OPEC-non-OPEC committee over the weekend in Vienna, Russia’s energy minister Alexander Novak said that OPEC and key non-OPEC oil producers are near their target of taking 1.8 million barrels of crude a day off global markets. Kuwaiti Oil Minister Issam A. Almarzooq, who chaired the meeting also spoke confidently of the agreement’s ultimate success.

The meeting of a joint OPEC-non-OPEC committee was set up to monitor compliance to the Dec. 10 agreement. Novak said that many countries are exceeding promised reductions. He said that firm figures wouldn’t be available before the end of the month, but an estimated 1.5 million barrels a day had been cut as of late January, less than two months after the agreement.

OPEC's latest monthly oil market report, issued last Wednesday, said OECD commercial stocks stood at 2.993 billion barrels in November. OPEC Secretary General Mohammed Barkindo noted that world oil stocks need to decline by at least another 270 million barrels to reach a five-year industry average for OPEC to be able to say the markets are becoming balanced.

OPEC will meet in May when it will decide whether to propose to extend the output cutting measures together with non-OPEC countries.