OPEC+ Cohesion Could be Eroding
OPEC+ cohesion could be eroding.
That’s what analysts at investment bank Jefferies stated in a new research note sent to Rigzone on Friday.
In the note, the analysts highlighted that a statement from the September 12 OPEC+ joint ministerial monitoring committee (JMMC) meeting “essentially called out the cheaters” and urged all countries to conform with their targets.
“The JMMC indicated that total conformity was high at 136 percent in August, but data from OPEC secondary sources and the IEA indicates that conformity had fallen to 109 percent,” the analysts stated in the note.
“Among the largest producers, Iraq and Nigeria are each not only well out of compliance but producing above their pre-cut reference levels. Russia only delivered about half its cut in August as well,” the analysts added.
“The cordial statement assured that the non-conforming producers would achieve conformity for the remainder of the year, but we question if the Saudis are running out of patience with the free riders,” the analysts continued.
In the JMMC statement, which was posted on OPEC’s website on Thursday, the committee urged all participating countries to “intensify their efforts in pursuit of full and timely conformity with their voluntary production adjustments”.
The committee also emphasized that cooperation and commitment were “more essential than ever” in the statement.
Earlier this week, Rystad Energy noted that a balanced oil market in 2020 is contingent on an extension of OPEC cuts through 2020. Back in July, a research note from Jefferies expressed that OPEC+ cuts will need to be extended through 2020 to keep the market in balance.
The next meeting of the JMMC is currently scheduled to take place on December 4 in Vienna, Austria. An OPEC conference is scheduled for December 5 and an OPEC and non-OPEC ministerial meeting is scheduled for December 6.
To contact the author, email andreas.exarheas@rigzone.com
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- ExxonMobil Racks Up Discoveries in Guyana Block Eyed by Chevron
- Oil Market Sentiment Has Improved Significantly
- EU, US Eye Collaboration on Nuclear Materials
- USA Driving Activity to Increase to All-Time Highs
- TC Energy to Sell Prince Rupert Gas Pipeline Project to First Nation
- EU Electricity Export to Ukraine Up 94 Percent in Two Years
- China Coal Output Falls for First Time since Government Ordered More
- BP Pulse Buys One of Europe's Largest Truck Stops
- UK CCUS Plans Outdated: Think Tank
- North America Enters Rig Loss Streak
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Rystad Looks at the Buzz Around White Hydrogen
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension