Daniel Lacalle

OPEC meeting … Not worried about shale oil

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OPEC+crudeFollowing on with my post about “the US path to energy independence“, it is interesting to highlight these data-points from the OPEC meeting:Implied OPEC spare capacity likely to grow to 6.38mbpd in 2018.

A solid increase from 5.76mbpd in 2013. Core OPEC (Saudi Arabia, Kuwait, UAE) spare capacity stands at 1.5 mboepd.OPEC production quota rolled over at 30.0 mboepd. This is consistent with defending a $100/bbl floor and the average breakeven price at $90/bbl.Latest OPEC production figures (April) show record production at 30.5 mboepd in line with OPEC estimates and targets.

OPECSaudi Arabia crude production 9.3 mboepd – which is 0.3 mboped above the implied quota – is likely to increase further in the coming months to meet increased seasonal demand in the US and from domestic power sector. This does not affect exportable capacity, which stands at record levels.


Saudi Arabia sees no threat from US tight oil to OPEC and $100/bbl oil, but more a source that is helping to stabilize the oil markets.


Iraq with production expected to double to above 6mboepd before 2020 needs to be brought into the quota system.


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