The Organization of Petroleum-Exporting Countries (OPEC) reduced its forecasts for non-OPEC oil supply growth in 2015 on Thursday, indicating that its apparent strategy of putting pressure on its American rivals could be working.
In its monthly report, published Thursday, the group of 12 oil-producing nations also said demand for the oil it produced would be higher than previously thought, at 29.3 million barrels per day (mb/d).
OPEC – which includes Saudi Arabia, Iran, Libya, Nigeria and Venezuela and others as members — has become well known over the last year for its refusal to reduce production, despite tumbling global oil prices amid a glut in supply.
The price of benchmark Brent crude oil has fallen from a high of $114 a barrel in June last year to trade around $62.30, but OPEC has been seemingly content to watch the price fall without cutting production in a bid to support prices.
The move has been widely seen as an attempt by the old guard of oil producers to put pressure on the new era of shale oil producers in the U.S. and Canada – where production costs are higher.