Nigeria and Libya Might Cap Crude Oil Production

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However, deepening production cuts already agreed to by OPEC and partners is not on the agenda for the July 24 meeting in St. Petersburg, he said. The revisions suggest the French lender had high hopes for OPEC's production cut extension, and now that it has failed to push up prices, there doesn't seem to be a lot of upward potential coming from anywhere else.

"The output from Libya and Nigeria have actually had more of an impact in undermining the efficacy of OPEC's cuts than even US shale", Tamar Essner, an energy analyst at Nasdaq NY, said by telephone.

By the end of this year, US crude oil exports could reach 1 million barrels a day.

When oil prices finally rose in January, so did cheap shale oil output in the United States, as USA producers viewed slightly higher fuel prices, even at the cost of a full market recovery, as an opportunity to bring new rigs online in the Permian and Bakken formations.

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Including Nigeria and Libya, which are exempt from the deal, output by all 13 OPEC members in June rose to about 32.47 million bpd, according to the average assessments of secondary sources OPEC uses to monitor its output. Reuters oil data showed OPEC production is now at the highest level this year. He was skeptical that Libya or Nigeria would agree on caps that were lower than their desired production levels since they have been "deprived" of their full capacity for some time. Yet, a technical committee holding talks to include Nigerian and Libyan representatives and talk about production plans before the ministers will have their formal discussions. However, OPEC and non-OPEC producers should consider Libya's political and economic situation before capping production.

This is while the price for August futures of West Texas Intermediate (WTI) has grown by 0.23 percent and stood at $44.50 per barrel.

Though new projects mean total global production continues to rise, the slide at aging fields may give OPEC a helping hand by reducing surplus supply today, according to Erlingsen.

Nigeria's finance minister met last week with OPEC Secretary General Mohammad Barkindo.