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ABU DHABI / WAM
Customers with contracts for the supply of Murban crude oil from the Abu Dhabi National Oil Company (ADNOC) have been advised of a 25 percent cut in allocations for March 2018, ADNOC sources have confirmed.
In a Twitter message, the Minister of Energy and Industry, Suhail Mohammed Faraj Al Mazroui, said that the cut was ‘in line with the UAE’s continued commitment to the OPEC and non-OPEC ‘Declaration of Cooperation.’
The Declaration runs until December 2018. The Murban crude oil blend is produced from ADNOC’s onshore oilfields. Under the OPEC & non-OPEC Declaration, the UAE committed to achieve a reduction in crude oil output of 139,000 barrels of oil per day (bpd).
Earlier this month, talking at the Gulf Intelligence UAE Energy Forum, Al Mazroui, who is also OPEC Conference President for 2018, noted that in the first twelve months of the Declaration OPEC and its non-OPEC partners had achieved a combined 107 percent conformity with the agreed cuts.
In December 2017, there was 129 percent compliance.
Industry sources note that, due to the efforts by OPEC and non-OPEC countries, there are positive inventory reductions and that the market is starting to re-balance.
There are, however, more than 100 million barrels of inventory overhang to be removed, sources say. The focus of OPEC and its non OPEC partners, therefore, is on maintaining compliance and completing the mission of reducing stock overhang and rebalancing the market.