Published: Mon, May 14, 2018
Finance | By Loren Pratt

Iran's oil output up 10000 bpd in April: OPEC

Iran's oil output up 10000 bpd in April: OPEC

The oil prices has become steady at $71 as OPEC signaled that it has the ability to fill in the supply gap only if USA sanctions are curtailed from shipments from Iran, which is the third largest producer of this group.

"Those constraints mean that oil prices could breach $80 a barrel over the next six months, particularly if OPEC production continues to remain underwhelming", he says.

The report also presented the country's average heavy oil price to be $66.56 in April, a $4.41 or 7.1 percent rise from $62.15 in March.

Oil has extended a rally this month to the highest level in more than three years as Trump's decision to walk away from the Iranian nuclear accord fueled tensions in the energy-rich Middle East and raised concerns over supply disruptions. But oil ministers have since said other metrics should be considered such as oil industry investment, suggesting they are in no hurry to end supply cuts.

As well as Opec's voluntary cuts, a plunge in Venezuelan oil output due to economic crisis and the United States' departure from a nuclear deal with Opec member Iran have supported prices. OPEC expects non-OPEC supply to expand by 1.72 million bpd this year, which is higher than the growth in global demand.

The higher crude prices that have followed have prompted growth in rival supply and a flood of US shale output.

The report comes roughly six weeks ahead of OPEC's semiannual official meeting in Vienna, at which the cartel and partner producers are expected to assess a joint agreement to rebalance the oil market by cutting crude production.

"Fast-growing US tight oil production is increasingly faced with costly logistical constraints in terms of outtake capacity from land-locked production sites", OPEC said.

The United States said on Tuesday that it plans to impose new sanctions against Iran after abandoning an agreement reached in late 2015 that curbed Tehran's nuclear activities in exchange for removal of USA and European sanctions. Saudi Arabia said last week it was ready to offset any shortage but would not act alone.

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