After Pledging Cuts, OPEC Countries Pump Record Amounts of Oil

[thackney]

After Pledging Cuts, OPEC Countries Pump Record Amounts of Oil
http://www.wsj.com/articles/after-pledging-cuts-opec-countries-pump-record-amounts-of-oil-1478617895
Nov. 8, 2016

Major oil-producing nations are pumping at full tilt ahead of their pledge to reduce output later this month, a big reason why the oil market has given up all of its recent gains.

The Organization of the Petroleum Exporting Countries has ramped up production to record levels beyond 33.5 million barrels a day, according to S&P Global Platts.

Russia has added about 500,000 barrels a day of output in the past two months, while the combined production of Libya and Nigeria brought another 500,000 barrels of new supply, according to the investment bank Simmons & Co. International.

That rising crude production has been pummeling U.S. oil prices, which are down 13% in less than three weeks. Prices settled up 0.2% at $44.98 a barrel on Tuesday.

The selloff cancels out the large rally that had followed an announcement in late September that OPEC members had agreed to a deal to cut crude production for the first time in eight years. Russia has also talked of joining the agreement.

Now, some analysts say that the rising output raises questions about whether the oil-producing nations are serious about reaching a deal to limit output.

“They are addicted to producing,” said Ric Navy, senior vice president for energy futures at brokerage R.J. O’Brien & Associates LLC....

[IsailedawayfromFR]

OPEC's lockstep has always been something of a mirage inasmuch members cheat and will when it gets right down to it do what's best for them, not the group.

For some if not most, Venezuela being a notable case, it is a question of survival as the largess of petrodollars funding ways to keep the elite in power has evaporated with low crude prices, into what is considered a stark reality of being chewed like shoe leather during popular unrest.