With glut almost gone, OPEC still cuts more than oil pact demands

Alex Lawler, LONDON (Reuters) – A global oil glut has been virtually eliminated, figures published by OPEC showed on Monday, thanks to an OPEC-led pact to cut supplies that has been in place since January 2017 and due to rising global demand. Despite this, OPEC’s latest report also said producers were cutting more than required under the deal, while producers not party to the agreement, such as U.S. shale companies, were starting to face constraints on future output. Saudi Arabia, the world’s biggest oil exporter and de facto leader of the Organization of the Petroleum Exporting Countries, told OPEC it cut output in April to its lowest level since the supply deal began in January 2017. The OPEC report said oil inventories in OECD industrialized nations in March fell to 9 million barrels above the five-year average, down from 340 million barrels above the average in January 2017. “The oil market was underpinned in April by renewed geopolitical issues, tightening product inventories and robust global demand,” OPEC said in its report. The deal between OPEC, Russia and other non-OPEC producers has helped oil prices LCOc1 reach $78 a barrel, their highest since 2014. Oil was trading above $77 on Monday,… continue reading

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