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MOSCOW (MRC) -- OPEC said oil
inventories have risen despite a global deal to cut supply and raised its
forecast of production in 2017 from outside the group, suggesting complications
in an effort to clear a glut and support prices, said Reuters.
In
a monthly report, OPEC also said its biggest producer Saudi Arabia increased
output in February by 263,000 barrels per day to 10 million bpd, after in
January making a larger cut than required by the OPEC accord to ensure strong
initial compliance.
The Organization of the Petroleum Exporting Countries
is curbing its output by about 1.2 MMbpd from Jan. 1, the first reduction in
eight years. Russia and 10 other non-OPEC producers agreed to cut half as
much.
OPEC said in the report oil stocks in industrialized nations rose
in January to stand 278 million barrels above the five-year average, of which
the surplus in crude was 209 million barrels and the rest refined
products.
"Despite the supply adjustment, stocks have continued to rise,
not just in the US, but also in Europe," OPEC said. "Nevertheless, prices have
undoubtedly been provided a floor by the production accords."
Oil prices
fell after the release of the report to trade close to USD50 a barrel, their
lowest since November. Crude is still up from about USD40 a barrel a year ago
and a 12-year low near USD27 reached in January 2016.
In the report, OPEC
pointed to an increase in its members' compliance with the deal, according to
figures from secondary sources that OPEC uses to monitor output. Supply from the
11 OPEC members with production targets under the accord -- all except Libya and
Nigeria -- fell to 29.681 million bpd last month, according to these
figures.
That means OPEC has complied by more than 100% with its plan to
lower output for those nations to 29.804 million bpd, according to a Reuters
calculation. OPEC gave no compliance figure in the report.
But the report
revised up its estimate of oil supply from producers outside OPEC this year, as
higher oil prices following the supply cut help spur a revival in US shale
drilling.
Production outside OPEC is now expected to rise by 400,000 bpd,
160,000 more than previously thought. US oil output in 2017 was revised up by
100,000 bpd.
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