Crude Oil bac at $48 after Saudis cut less production than expected

Crude Oil bac at $48 after Saudis cut less production than expected

 

Crude has significantly dropped, not only because Saudis announced cutting less than previously  but also the Iranian oil minister said they’ll keep production at 3.8mbpd through the second half of 2017.  Kuwait also popped up to say that they see oil dropping to $45 on a pick up in US shale production. OPEC raised world oil demand growth forecast to 1.26mln barrels per day with 1.19mln barrels previously. Key points of the report:

  • OPEC hiked demand forecast by around 200kbpd to 32.35mbpd
  • Cartel raises non-OPEC demand forecast to 400kbpd vs 240kbpd
  • US forecast revised up to 100kbpd on a rebound in shale
  • Oil market to start balancing or will start to see an inventory drawdown in H2 2017
  • Says OECD inventories in Jan above 5 year average at 278m despite the oil deal
  • Reuters calc on secondary sources show 11 OPEC members with over 100% compliance
  • 11 members cut output to 26.681mbpd, 123kbpd over target
  • OPEC secondary sources say output fell 140kbpd to 31.958mbpd
  • Saudis say they raised output to 10.011mbpd vs 9.748mbpd but still below OPEC target

 

USOil Daily Chart, XStation

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