OPEC Witnessed 75% Fall In Output Cut Compliance In December 

Yemisi Izuora

The Organization of Petroleum Exporting Countries, OPEC+ compliance with pledged oil output curbs fell to 75 per cent in December, among the lowest levels since the supply pact started in May 2020, tanker tracker Petro-Logistics said.

This is a lower estimate of compliance by the Organization of the Petroleum Exporting Countries and allies, known as OPEC+ than others have reported. A trend of lower compliance could weigh on oil prices, which are currently at an 11-month high.

OPEC+ made a record oil-output cut of 9.7 million barrels per day, about 10 per cent of world output, to support prices which were pushed to historic lows by the coronavirus pandemic.

They had tapered the cut to 7.7 million bpd by December.

Petro-Logistics, a Geneva-based consultant, said December compliance by the OPEC members participating in the deal fell to 82 per cent down 10 per cent from November, with top exporter Saudi Arabia among the nations showing weaker adherence.

“Even Saudi Arabia saw its compliance drop 10 per cent to 92 per cent, “Petro-Logistics said in an email to Reuters.

The non-OPEC countries involved in the pact, of which Russia is by far the largest producer, was even lower at 64 per cent, down 8 per cent from the previous month.

Other estimates have so far found December compliance to be higher.

A Reuters survey found OPEC delivered on 99 per cent of pledged cuts in December. A survey by Platts, one of the sources OPEC uses to track its output, put adherence by OPEC+ at 99 per cent.

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