EIA raises USA oil production growth forecast for 2018

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Mr Barkindo said consultations were under way for the extension of the OPEC-led pact beyond March 2018 and that more oil producing nations may join the supply pact, possibly at the next meeting of OPEC in Vienna on November 30.

But with strong oil demand growth, summer demand, and Brent futures flipping to backwardation, the OECD commercial stocks have started to draw down faster in the summer.

Still, OPEC is not banking on a surge in prices, saying in the report crude is expected to remain at $50 (37.91 pounds) to $55 a barrel in the next year.

Barkindo stressed, however, that the oil market is a global one.

But Mr Barkindo said he was not anxious about the rise in U.S. shale oil and gas output.

In a further sign that the supply excess is easing, OPEC said inventories in developed economies declined by 24.7 million barrels in August to 2.996 billion barrels, 171 million barrels above the five-year average.

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Oil prices rose for the third day on Wednesday as OPEC forecast higher demand for 2018 and heightened tensions in Kurdistan supported prices. Oil prices have crashed to Dollars 50s now, from the high of USD 147 per barrel in 2008.

It also stated that prices may fall again in the second quarter of the next year to $48 a barrel when the oil output is expected to surge again. Saudi Arabia and Russian Federation, he said, are leading the initiative to bring in more producers. OPEC does not issue price forecasts.

Currently, the EIA expects total US crude oil production to average 9.3 million bpd for 2017 and 9.8 million bpd in 2018, which would mark the highest annual average production in USA history, surpassing the previous record of 9.6 million bpd from 1970.

The figures mean Opec has complied 98 per cent with the cutback pledge, according to a Reuters calculation, up from 83 per cent initially reported in August as the September rise was led by Nigeria and Libya which are exempt from the cut.

Opec's forecasts see that in 2018 that both rising demand and non-Opec output will leave room for its members to pump more and reduce the glut in supplies.

Should OPEC keep pumping at September's level, the market could move into a deficit next year, the report indicates.

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