OPEC projects surge in U.S. oil production

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

U.S. shale drillers could pump a lot more oil than previously expected this year, OPEC said Thursday.

In a monthly report, the cartel said it has revised its 2017 forecast for oil production in countries outside of OPEC up by 370,000 barrels a day. More than three quarters of the increase will come from the United States – even as OPEC cuts oil production in a bid to support prices.

The Organization of Petroleum Exporting Countries will gather in Vienna later this month to decide whether or not to extend the oil-production cuts that, in recent weeks, seem to have lost their oil-market luster as prices fall on new forecasts of higher U.S. shale oil output.

OPEC, which has been slower than other forecasters to acknowledge rising U.S. oil production, warned the U.S. surge could throw off its attempts to stabilize oil prices. Even though refiners are taking more oil from floating storage facilities, realigning global oil supply and demand by the end of the year would take “a collective effort by all oil producers,” the cartel said.

In February, daily U.S. oil output climbed above 9 million barrels, up half a million barrels since September. OPEC expects the nation’s oil production to rapidly increase by 614,000 barrels a day this year, while Canada and Brazil raise output a combined 430,000 barrels a day.

OPEC’s daily output decreased by 18,000 barrels to 31.7 million, independent sources said.