SANUSI BARKINDO, SECRETARY general of the Organisation of Petroleum Exporting Countries (OPEC) has stated that there was a 268 million barrels drop in excess oil in the Organisation for Economic Co-operation and Development, (OECD) countries in 2017.
The OECD is an intergovernmental economic organisation with 37 member countries, founded in 1961 to stimulate economic progress and world trade.
He stated this in his foreward to the oil cartel’s 2017 annual report.
According to him, the steady rebalancing of the oil market over the year could be clearly seen in depleting stock figures with the overhang of 340 million barrels (mb) of oil in OECD economies, at the beginning of 2017, dropping by 268 mb by the end of the year.
He said the high conformity levels by participants provided a significant boost to confidence and to the success of the Declaration of Cooperation.
Although growth in the Euro-zone lifted to 2.5 percent in 2017, the OECD reached 2.5 percent in 2017, he further said.
“The momentum in the global economy is set to continue into 2018, with an ongoing, synchronized expansion across the world. Emerging and developing economies also saw strong momentum in 2017, with Brazil’s economy continuing to recover and experiencing growth of 1.0 percent, China’s GDP growth was stable at 6.9 percent, India saw growth of 6.4 percent and Russia continuing to recover from a recession, with growth of 1.5 percent.
“OPEC Member Countries saw an overall improvement in business conditions with GDP growing at the highest rate since the oil market downturn of 2014,” he said.
According to him, non-OPEC supplies continued to grow in 2017, by 0.87 mb/y to average 57.87 mb/d, led by production in the US, Canada, Mexico and the UK, adding that the US remained the key driver of non-OPEC supply growth, with its tight crude production surpassing expectations.
“The healthy developments were further reflected in the oil futures market in 2017, which improved to exceed $50/b, spurred on by strong demand and declining global inventories. Meanwhile, the OPEC Reference Basket ended 2017 significantly higher at $52.43/b, up by 28.6 percent, or $11.67, compared with 2016.
“As always, there are many factors influencing the oil market. Downside pressure may come from renewed production from OPEC countries which saw disrupted volumes over the past years, as well as strong growth in non-OPEC production.
“However, there are plenty of sources of upside pressure as well, including geopolitics, natural decline, weather interruptions, the incomplete rebound of investment, high debt in some countries and monetary policy,” he added.