EIA assumes that OPEC will limit production until late 2021

US Energy Information Administration (EIA) assumes that OPEC will limit production through all of 2020 and 2021, Report informs citing the EIA.

"On December 6, 2019, OPEC and a group of other oil producers announced they were deepening the production cuts originally announced in December 2018. The group is now targeting production that is 1.7 b/d lower than in October 2018, compared with the previous target reduction of 1.2 million b/d. OPEC announced that the cuts would remain in effect through the end of March 2020. However, EIA assumes that OPEC will limit production through all of 2020 and 2021 to target relatively balanced global oil markets. As a result of production restraint from most OPEC members and continuing production declines in Iran and Venezuela, EIA expects OPEC production to fall in 2020," the EIA said.

EIA forecasts that OPEC crude oil production will average 29.2 million b/d in 2020, down 0.6 million b/d from 2019. In 2021, it predicted OPEC crude oil production would increase by 0.1 million b/d.

On December 6, 2019, OPEC+ decided to reduce output by 500,000 barrels more. According to the new Declaration of Cooperation, Azerbaijan's obligation is 27,000 barrels. Starting in January 2020, Azerbaijan must maintain its daily output at 769,000 barrels.