OPEC on Monday revised up its forecast for worldwide oil demand in 2017 and reported record-setting compliance in the first month of a deal to reduce crude supplies.
The new forecast comes after a recent commitment by the organizationand 11 non-OPEC countries to reduce production in a bid to manage supply and demand levels better. In January, OPEC production decreased by 890,000 barrels per day, according to secondary sources noted in OPEC’s latest monthly report.
Among the OPEC members who have committed to production quotas, total output in January was 29.9 million barrels a day. That puts compliance with the deal, which aims to remove about 1.2 million barrels a day from the market, at as high as 93 percent, according to Reuters.
The market was anticipating a high degree of compliance after Reuters, S&P Global Platts and the International Energy Agency last week reported OPEC had achieved at least 90 percent of the cuts.
As anticipated, Saudi Arabia delivered the lion’s share of reductions. Its production was down by about 496,000 barrels a day.
That was partially offset by production increases in Nigeria and Libya, which are exempt from the deal as they seek to restore oil supply that was sidelined due to internal conflicts.
Iran is also allowed to continue increasing production up to a point following the lifting of sanctions last year. It raised output in January by about 50,000 barrels a day.