OPEC oil output fell by 797,000 bbl/day last month -January 2019, as most of cartel’s members comply with the oil output cut deal in an effort to balance the oil market and drive oil price higher.
OPEC Crude Oil Production Data, Source: OPEC Monthly Oil Market Report, February 2019
The biggest decline came from Saudi Arabia and UAE. Both countries saw their oil output fell by 350,000 bbl/day and 146,000 bbl/day respectively.
On the other hand, unlike what was expected, Iran’s oil output fell by only 4000 bbl/day according to the data, despite the US sanctions that was imposed last year.
The oil output decline reported by OPEC members supported oil prices in the last two weeks, driving oil prices higher.
The cartel’s oil output decline trend is expected to continue this month as well due to geopolitical tension in some of the cartel’s member countries which could lead to output disruption.
Another reason for expecting oil output decline from OPEC is that fact that members like Saudi Arabia and UAE are willing to cut further oil output to drive oil prices higher.
Planed production decline by Saudi Arabia decline could also be as that, Saudi Arabia’s eagerness to drive oil prices higher and that can be achieved through further oil output cut.
