OPEC Secretary General Mohammad Sanusi Barkindo said on Thursday he remains confident that producers will comply with the group’s planned production cuts.
Speaking at the Atlantic Council’s Global Energy Forum in Abu Dhabi, Barkindo told the Associated Press that he remains “very confident” that both OPEC and non-OPEC producers will lower production.
“The level of commitment from both sides … is unparalleled,” Barkindo told the AP.
Barkindo added that there has been a “high level of compliance” with the production plans.
OPEC members agreed in December to trim the group’s total production by about 1.2 million barrels per day to about 32.5 million bpd.
A group of 14 non-OPEC producers, including Russia, also agreed last month to cut their overall production by about 558,000 bpd.
Both production plans will be in place for an initial six month period and were effective at the start of the new year.
Compliance with the production plan will be overseen by a committee of OPEC members being led by Kuwaiti Oil Minister Essam al-Marzouq.
Al-Marzouq told the AP on Thursday that compliance with the plans should be judged on the average production levels seen at the end of the initial six months.
The compliance committee is scheduled to meet in Vienna on January 21.
While it remains too early to know if OPEC and non-OPEC producers will swiftly comply with the cuts, OPEC production did post a 280,000 bpd decline in December.
According to data collected by S&P Global Platts, total OPEC production fell to 32.85 million bpd in December, down from a record high of 33.13 million bpd in November.
The production dip was the first OPEC has recorded in seven months.
Libya and Nigeria are exempt from the production cuts under the OPEC plan.
Rising U.S. production could complicate the production picture and crude price outlook.
The U.S. Energy Information Administration (EIA) said on Wednesday that it expects U.S. oil production is expected to continue climbing into 2018.
The EIA is now forecasting U.S. crude production to average 9 million bpd in 2017, up from a previous estimate of 8.7 million bpd.
The agency expects U.S. crude production to climb to 9.3 million bpd in 2018.
The EIA currently expects the pace of OECD oil inventory builds to “slow considerably” to an annual average of 300,000 bpd in 2017 and 100,000 bpd in 2018.
The EIA added that OECD inventories are forecast to post an average 100,000 bpd draw during the second half of 2018.
Despite rising U.S. production, the EIA boosted its Brent crude price forecast to an average $53 per barrel in 2017, up from a previous forecast of $51 per barrel.
