Seoul: The Organization of Petroleum Exporting Countries (OPEC) has a compliance rate with their output cut pledges of about 86 percent, Fatih Birol, the executive director of the International Energy Agency (IEA), said on Tuesday.
“Their compliance is about 86 percent, higher than in the past… whether or not they will continue with this plan in November it’s up to them,” Birol said on the sidelines of the World Knowledge Forum in Seoul.
“If they do so, we may see, sometime next year, a rebalancing of the markets, as we still see a significant amount of stock in the markets which is higher than historical averages.”
OPEC and other producers including Russia agreed to cut their production by around 1.8 million barrels a day until next March to drain a global oversupply and prop up prices.
Asked about the conflict in Iraq between the government and separatist Kurds and the United States’ decision to decertify its nuclear deal with Iran, Birol said it is premature to assess the impact of these geopolitical risks on oil markets.
“It is too early to say how these geopolitical developments will continue and how much they will have an impact on oil prices,” Birol said.
“These issues remind us oil and geopolitics are very much interlinked and it will remain so… oil security remains a critical issue for all the countries,” he said.
