OPEC slashes output in March, expects shale comeback

Khalid Al-Falih, Saudi Arabia’s energy and industry minister, arrives for the 171st Organization of Petroleum Exporting Countries (OPEC) meeting in Vienna, Austria, on Wednesday, Nov. 30, 2016. Oil climbed as Iran said it has good expectations for a make-or-break OPEC meeting on stabilizing the crude market. Photographer: Akos Stiller/Bloomberg

OPEC producers took another 153,000 barrels a day off the market in March as part of its bid to drain the world’s oil glut.

In the cartel’s monthly report released Wednesday, independent sources reported the group of oil-producing countries has cut output by 1.1 million barrels a day since December.

Last month, Libya’s output dropped by nearly 9 percent, and production edged lower in the United Arab Emirates, Venezuela, Nigeria, Iran, Angola and other countries. Saudi Arabia raised production by 41,000 barrels a day.

That effort has pushed oil prices above $50 a barrel in recent months, breathing life into U.S. oil patches like the Permian Basin. U.S. crude rose 16 cents on Wednesday to $53.56 a barrel on the New York Mercantile Exchange, as traders reacted to  media reports that Saudi Arabia, the cartel’s de facto leader, wants to see OPEC continue production cuts into the second half of this  year.

But even as the Organization of Petroleum Exporting Countries works to slow the onrush of oil, it expects increasing resistance from American shale producers and other non-OPEC countries. The group revised its projection for U.S. oil production up by 200,000 barrels a day.

Related: U.S. oil output could near 1970 record next year, EIA says

Despite OPEC’s cuts, oil producers around the world still put out 430,000 barrels a day more than international markets could absorb in the first quarter, according to the report.

Last year, global demand briefly outpaced daily supply in the third quarter, by 330,000 barrels a day. But the oversupply returned by the fourth quarter, when oil producers made 1.1 million barrels a day more than global demand.