More evidence that the OPEC cartel production ceiling is unsustainable collusion. From May to June, OPEC production increased by almost 100,000 barrels per day. Check out the table at the bottom of the article to see who was able to cheat, and by how much, according to these estimates from Platts. Furthermore, this Reuters story suggests that
… extra demand will be accompanied by a continued rise in supplies from nations independent of OPEC, leaving the cartel little room to manoeuvre in easing output restraints if it wants to keep oil prices near its $25 a barrel target.
“Economic recovery should be in full swing next year so we’re projecting global demand growth of 1.3 million barrels a day,” said Adam Sieminski of Deutsche Bank.
“But we expect non-OPEC growth of about 800,000 barrels a day and that will put a lot of pressure on Saudi Arabia to hold OPEC discipline together.”
This article from yesterday’s New York Newsday also discusses the changing mindset of Russia’s energy entrepreneurs, seen through the lens of their evolving relationship with Iraq.