Saudi Arabia managed to outpace the United States in oil production due to the fact that since may, the daily production of the Arab countries has increased by 400 thousand Barr., while in the United States during the same period, this figure was reduced to 460 thousand barrels, published September 13 report, the International energy Agency (IEA). According to the Agency, in August oil production in Saudi Arabia amounted to 10.6 million barrels. a day.
The United States through the so-called shale boom held the first place in oil production since April 2014, says Bloomberg. The reduction of the U.S. production occurred against the backdrop of a sharp decline in the number of working drilling rigs according to Baker Hughes, in may it fell to a record low (404). At the beginning of September, it had grown to 508.
According to the U.S. energy information Administration (EIA), oil production in the US in August averaged slightly over 8.5 million barrels. a day. Taking into account other “liquid hydrocarbons” production in the USA amounted to 12.2 million bbl. a day, the report says the IEA.
In its forecast, the IEA notes that the balancing of supply and demand on the world oil market is delayed. According to the forecast Agency, the offer will exceed the demand at least in the first half of 2017. Thus, 2017 will be the fourth consecutive year when the offer in the oil market exceeds demand. IEA lowered its forecast for global oil demand in 2016 to 96,1 million barrels., noting that in the third quarter of 2016 the growth in oil demand slowed to two-year low (0.8 per bbl. per day) on the back of lower demand in China and India. In 2017, global oil demand is projected at 97.3 million barrels. a day.
The organization notes that the effect of the declining oil production in countries outside OPEC is almost entirely offset by the almost record levels of production in the cartel (33,47 million barrels. per day) due to the high production in Saudi Arabia, Kuwait and the UAE, as well as production capacity of Iran in the post-sanctions period.
Markets significantly responded to bearish data report, the IEA quotes of Brent oil dropped from $47,87 to $47,35 per barrel. (as of 12:25 Moscow time), WTI — from $45,70 to $45,16.
Oil-producing countries for months trying to agree on freezing the level of oil production. The most serious attempt was made in mid-April talks in the Qatari capital Doha where he participated as members of OPEC and other oil producing countries outside the cartel (including Russia). Then the negotiations failed because of the reluctance of Iran to keep oil production to restore its pre-sanctions targets.
It is expected that a new attempt to negotiate a freeze of production will be taken on the sidelines of the International energy forum, which will be held 26-28 September in Algeria. Your consent to participate in the negotiations have confirmed energy Minister of Saudi Arabia, Iraq, Iran. Your potential consent to participate in negotiations was announced by the Minister of energy of Russia Alexander Novak. In early September, Russian President Vladimir Putin in an interview with Bloomberg said that he hoped a compromise among oil producers since the agreement on the freezing of oil production it would be right for the world market.