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World global reserves could reduce by half

Based on the IEA’s data, Bloomberg experts have counted the approximate changes in oil reserves in the first half of 2017.

13.Dec.16 12:08 PM
By Anna Tuzova


World global reserves could reduce by half
The world oil reserves could reduce by half in the first two decades of 2017. That is possible only if OPEC and 11 independent oil producing countries, which signed an agreement in Wien on 10 December would fulfill their commitments and reduce the output by 1,76 million barrel per day. In this case the accumulated since 2014 world reserves would decrease with a speed up to almost 760 thousand barrel per day. In six months of 2017 the reserves will diminish by 46% or about 300 million barrel.

There is probability of inappropriate implementation of the agreement. For OPEC the completion of the agreement on reducing oil output by 1,2 million barrel per day is facing the problem of increasing the production by Libya and Nigeria, which have been freed from the limitation. Outside the OPEC the main risk factor is Russia, which promised to cut its values by 300 thousand barrels per day by the end of the first decade of 2017.

If we assume that agreements would be fulfilled, the supply will lag behind demand by 400 thousand per day on the first half of 2017 (according to forecasts based on IEA data). At the same time, the total volume of oil produced in OPEC and 11 countries outside the Cartel would be by 360 thousand barrel per day lower than IEA’s estimated.

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