OPEC on Thursday
sharply raised its forecast for oil supply from non-member countries in
2017 as higher prices encourage U.S. shale drillers to pump more,
hampering the producer group's efforts to clear a glut and support
prices by cutting output.
In
a monthly report, the Organization of the Petroleum Exporting Countries
said outside producers would boost supply by 950,000 barrels per day
(bpd) this year, up from 580,000 bpd expected previously.
The 13-country OPEC is curbing its output by about 1.2 million bpd from Jan. 1 for six months, the first reduction in eight years. Russia and 10 other non-OPEC producers agreed to cut half as much.
The report will add to a debate about the effectiveness of the cut, which is expected to be extended when producers meet later this month. While oil prices have gained support, higher rival supply is limiting further gains and an inventory glut has proved slow to shift.
Oil prices pared gains on Thursday after the release of the report to trade at less than $51 a barrel LCOc1, below the $60 level that top OPEC producer Saudi Arabia would like to see. Prices are still up from about $48 a year ago.
In the report, OPEC pointed to continued high compliance by its members with the supply deal and said oil stocks in industrialized nations fell in March - although they are still 276 million barrels above the five-year average.
Supply from the 11 OPEC members with production targets under the accord - all except Libya and Nigeria - fell to 29.674 million bpd last month, according to figures from secondary sources that OPEC uses to monitor output.
That means OPEC has complied 111 percent with the plan, according to a Reuters calculation, up from an estimate in March of 104 percent. OPEC did not publish a compliance number.
The 13-country OPEC is curbing its output by about 1.2 million bpd from Jan. 1 for six months, the first reduction in eight years. Russia and 10 other non-OPEC producers agreed to cut half as much.
The report will add to a debate about the effectiveness of the cut, which is expected to be extended when producers meet later this month. While oil prices have gained support, higher rival supply is limiting further gains and an inventory glut has proved slow to shift.
Oil prices pared gains on Thursday after the release of the report to trade at less than $51 a barrel LCOc1, below the $60 level that top OPEC producer Saudi Arabia would like to see. Prices are still up from about $48 a year ago.
In the report, OPEC pointed to continued high compliance by its members with the supply deal and said oil stocks in industrialized nations fell in March - although they are still 276 million barrels above the five-year average.
Supply from the 11 OPEC members with production targets under the accord - all except Libya and Nigeria - fell to 29.674 million bpd last month, according to figures from secondary sources that OPEC uses to monitor output.
That means OPEC has complied 111 percent with the plan, according to a Reuters calculation, up from an estimate in March of 104 percent. OPEC did not publish a compliance number.
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