OPEC Chief Outlines Progress Toward Oil-Output-Cut Deal Secretary-general Mohammad Barkindo says member nations reach consensus on using production figures from outside agencies
Nov. 4, 2016 5:36 p.m. ET
Members of the Organization of the Petroleum Exporting Countries have agreed to use a unified set of independent production data for output cuts, lifting a key hurdle toward the implementation of a landmark output agreement, the group’s chief said Friday in an interview with The Wall Street Journal.
The development came at a meeting of OPEC technical experts last weekend and is an important step for the group toward completing a production-cut deal on Nov. 30, when the 14-nation cartel meets in Vienna, Secretary-General Mohammed Barkindo said. OPEC, which controls about 40% of global oil production, agreed in September to cut up to 2% of its output to curb a global oversupply of petroleum and raise crude prices
Iraq and other OPEC members had balked at using production figures that OPEC calls “secondary sources”—information compiled by the International Energy Agency, the U.S. Energy Information Administration, Argus Media and other independent organizations. These groups come up with oil-production numbers for OPEC members and other nations by gathering information from shippers, oil traders, government export data and other sources.
Iraq and others had wanted their own official government production figures to be used instead. They have said the independent sources’ production numbers are often incorrect.
Friday, though, the 14 members of OPEC have “agreed to use [secondary sources] in monitoring compliance,” Mr. Barkindo said. He left some wiggle room for the group’s members by adding that there was “more or less” an agreement.
Mr. Barkindo also said Iraq had agreed to work with secondary sources to get its numbers revised. “They have already started engaging with the [secondary sources],” he said. “It can’t resolved at once and they understand that.”
OPEC still has a long way to go before completing the deal. Iran, Libya and Nigeria also want exemptions from cutting production altogether, though Iraq and Iran could go along with a commitment to hold their production steady depending on the level.
The EIA and Argus didn’t respond immediately to requests for comment and the IEA couldn’t immediately comment. The Iraqi oil ministry didn’t respond to a request for comment.
Mr. Barkindo also said Saudi Arabia, the group’s largest producer, had signaled it would keep up with its pledge to be part of the Algiers deal. “Both the Saudis and [other member countries] worked very [hard] to build the consensus that produced the Algiers Accord,” Mr. Barkindo said. The kingdom remains “committed to its implementation in a collective, fair, equitable and transparent manner,” he said.