Oil Market’s Big Data Show OPEC+ Cuts Fall Short
Full implementation of output cuts still leaves stockpiles building in 1H ‘20
Abdulaziz bin Salman, Saudi Arabia's energy minister, center, speaks to a delegate ahead of the 177th OPEC meeting in Vienna, on Dec. 5.
Photographer: Stefan Wermuth/BloombergThe three big oil forecasting agencies all see OPEC producers needing to comply fully with output cuts they agreed in Vienna last week if they are to avoid big builds in inventories in the first half of 2020. But even that may not be enough, as demand estimates from two of them weaken again.
OPEC and its non-OPEC allies decided to reduce their collective output target by a further 500,000 barrels a day for the first quarter of 2020, taking the reduction from 2018 baselines to 1.7 million barrels a day. Saudi Arabia said it would reduce its own target by an additional 400,000 barrels a day — as long as all the other participants adhered to their pledges.