Dec 2016 Financial News

OPEC asks T&T to cut back oil

Dec 07, 2016

T&T is among 14 countries that the Organisation of Petroleum Exporting Countries (Opec) has invited to discuss cutting back on oil production.

The non-OPEC countries are being asked to follow, by a lesser amount, the cuts agreed to by Opec last week that has already resulted in an 18 per cent rise in the price of oil.

The invitees are Russia, Mexico, Bahrain, Colombia, Congo, Egypt, T&T, Bolivia, Kazakhstan, Uzbekistan, Turkmenistan, Azerbaijan, Oman and Brunei.

Altogether, the 14 nations pumped about 18.8 million barrels a day of oil last year, equivalent to 20 per cent of global supply.

With local production around 66,000 barrels per day, it’s unclear how much T&T will be asked to cut, if at all, at the December 10, talks in Vienna, Austria.

Russia has already committed to reduce its output by 300,000 barrels a day following OPEC’s agreement last week to a production cut of 1.2 million.

The new 32.5 million barrel-a-day production target is only slightly below the OPEC’s estimate for demand for its crude next year, meaning wider co-operation is needed to make a significant dent in the record stockpile surplus that has built up during three years of oversupply.

“It remains unclear to us which other non-OPEC producers might be willing to commit to or even claim production cuts,” JBC Energy GmbH said in a note.

“Although OPEC officials spoke of a 300,000 barrel-a-day contribution from Russia towards an overall 600,000 barrel-a-day non-OPEC cut, we remain quite sceptical that this will actually happen.”

After Russia, Mexico is the largest producer invited to Vienna.

While the nation’s output is expected to fall by about 150,000 barrels a day next year to 1.94 million due to the natural decline in production at ageing fields, the country doesn’t plan any further cuts, a Pemex official said last week.

Oman, which pumps about 1 million barrels a day, has committed to matching any oil-output cut agreed by OPEC up to a maximum of 10 per cent.

Source:
Trinidad Guardian
Wednesday December 7, 2016

http://www.guardian.co.tt/business/2016-12-06/opec-asks-tt-cut-back-oil