OPEC sees tighter supply on the oil market


The supply on the global oil market is likely to become considerably tighter in the coming period due to the production reductions of oil cartel OPEC and its allies and the serious production disruptions in Venezuela. OPEC writes this in its monthly report.

According to the report, production at OPEC members fell last month by 534,000 barrels per day to just over 30 million barrels per day. In Venezuela there was a decrease of 289,000 barrels to 732,000 a day. If OPEC production were to remain at that level, the global oil reserves would decrease considerably this quarter and next year, the organization thinks.

Saudi oil minister Khalid Al-Falih said earlier this week that he believes that OPEC, together with partners such as Russia and Kazakhstan, should extend the agreement for a production restriction for the remainder of this year. This agreement expires at the end of June. OPEC and its allies meet that month.

In the meantime, oil prices have reached the highest levels of this year. That also has to do with the increasing violence in oil-rich Libya. The price of a barrel of American oil was 0.6 percent higher on Wednesday afternoon at $ 64.39 and Brent oil climbed 0.4 percent to $ 70.90 per barrel.

By: Nicholas de Kramer

Nicholas de Krammer, а self-taught economic analytic with heave mathematical background. Math behind the economics (and economics behind math) is the strong side of the author. Contact him at nicholas.dekramer@economicinform.com

Add comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Recent Posts


About us

EconomicInform, EconomicInform.com is a product of EconomicInform LLC. We sincerely believe that economics is one of the most interesting and most underappreciated – in terms of getting some enjoyment out of reading the subject articles – sciences. More on that - at the link. Feel free to drop us a line.