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The International Finance Institute awards the decision to increase the volume of world oil production by 1 million barrels per day from July to changes in supply and demand conditions, according to a decision made by OPEC in agreement with the top 10 global producers According to the report of the Central Bank of Egypt, this decision met the demand of major consumer countries such as the United States, the China and India to increase their oil supplies to avoid global shortage and raise prices threatening the growth of the global economy.
The report highlighted Iran's opposition to any change in the original agreements in the run-up to the meeting, noting that oil prices received additional support after the re-imposition of US sanctions on its oil exports. The report indicated that the agreement was vague, as the organization did not reveal how the distribution of production increased between countries.
The report indicated that OPEC reached an agreement in November 2016 with the major producing countries to reduce production by 1.8 million barrels per day. Since the beginning of 2017, to rebalance the oil market and support prices, the resulting reductions have largely exceeded this level.
Unexpected production interruptions in Venezuela, Angola, and Libya contributed to a significant rise in prices. Factors leading to price increases At $ 80 per barrel in May 2018, its highest level since 2014.
The report highlights the increase in the volume of US production more than doubled since 2008, with the development of techniques of oil extraction of rock ore layers, known as breaking hydraulic technology. "Fracking
OPEC's commitment to reduce its production since the beginning of 2017 has also boosted oil prices by about 50%." The commitment of the countries of OPEC to implement the reduction was about 160% in May 2018. The commitment of non-member countries was limited to 60% as Kazakhstan exceeded its production ceiling. "The report states While uncertainty about future production trends prevails in Venezuela and Iran, Venezuela's production may continue to decline, but prospects for its gradual recovery are still in place. As for Iran, it has not yet determined how much of its oil exports would be subject to US sanctions, some of its trading partners such as China, Russia, India and the United States. Turkey having no intention of reducing their oil imports. On the other hand, countries such as Japan and South Korea are likely to boycott Iranian exports. The International Finance Institute plans to reduce Iranian exports by 0.3 million bpd on average in the second half of 2018 and by 0.6 million barrels per day in 2019. Although US and Canadian production will increase, it will not In the short term it will not suffice to offset the shortage of Venezuela and Iran, while covering the projected increase in world demand in 2018 by 1.4 million barrels a day.
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