OPEC members said they're committed to adequate market supplies given downturns in production in some parts of the world. Logo courtesy of the Organization of Petroleum Exporting Countries
June 4 (UPI) -- Parties to an OPEC-led effort to collaborate on the methods necessary for a healthy market said they were committed to help offset oil production declines.
Members of a joint ministerial monitoring committee met during the weekend in Kuwait City to review market conditions ahead of the next regular meeting of members of the Organization of Petroleum Exporting Countries in late June.
With support from non-member states like Russia, OPEC is in its second year of a policy of cutting almost 2 million barrels per day from collective output to drain the surplus on the five-year average of crude oil inventories held by the world's leading economies.
Escalating oil prices in 2018, however, has brought calls to ease the level of discipline for participating countries. The steady decline in production from Venezuela and potential losses from Iran has created a market with little room for risk.
According to a statement published by the Kuwait News Agency, committee members said they were mindful of actual and potential supply-side deficits.
Parties called for a sustained commitment to the agreement. "The ministers also emphasized the need for healthy market conditions that stimulate adequate investments in the energy sector, in order to ensure stable oil supplies are made available in a timely manner to meet growing demand and offset declines in some parts of the world," the statement read.
Russian Energy Minister Alexander Novak said in late May that parties to the agreement may pull back from over-compliance in the second half of the year.
Compliance in April was 152 percent and participants could move back toward 100 percent.
Speaking last week in Azerbaijan, OPEC Secretary General Mohammad Barkindo said the surplus on the five-year average in global crude oil inventories is gone. The next phase of focus will be on designing ways to guard the market against supply stocks and extreme volatility.
"This is a clarion wake-up call that every effort should be made to avoid a potential supply gap that could present a serious challenge to the industry in the medium to long term," he added.