Except it attains a 100 per cent compliance with its new crude oil supply cut and count on continued production declines in Iran and Venezuela, the Organisation of Petroleum Exporting Countries (OPEC) has predicted a price-depressing build in oil inventories in 2019.
In its monthly oil market report on Wednesday, OPEC’s analysis arms said the full compliance to the 1.2 million barrels per day production cut deal would leave the bloc about 500,000 bpd above expected demand for its crude for the first quarter of 2019.
It also said that it would be left with 400,000 bpd above the call for the second quarter.
The forecasted call on OPEC crude for Q1 2019 is 31.67 million bpd, rising to 31.77 million bpd in Q2, OPEC said in its report.
The figures all include Qatar, which has announced it is withdrawing from the organization from January. Qatar pumped 610,000 bpd in October.
On Friday, OPEC and its 10 allies including Russia and Saudi Arabia agreed a 1.2 million barrels per day production cut deal for six month starting from January 2019.
According to the deal, OPEC is expected to shoulder 800,000 bpd of the production cut.
e deal left out Iran who is facing sanctions as well as Venezuela who is currently experiencing economic challenges.
Libya had also been exempted from the deal owing to instability and crises the country is facing.
Libya, whose production levels have been erratic due to internal instability, was also exempted from the cuts.
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