Joint Committee Praises OPEC for its Oil Cutback Compliance, but "Zero Chance" the U.S. Will Come On Board

The U.S. won't be accepting an offer from The Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) to join the Organization of the Petroleum Exporting Countries' (OPEC) oil output reduction accord – and not just because energy independence booster Donald Trump is now in the White House.

James Hamilton, a professor of economics at the University of California, told Sputnik that "There is zero chance that the United States would join in an agreement to cut oil production [because] such an agreement would be a violation of U.S. law, including the Sherman Antitrust Act and the Clayton Act."

The acts were passed to address oppressive business practices associated with cartels and monopolies.

For the record, president Trump has stated that the U.S. will be "committed to achieving energy independence from the OPEC cartel and any nations hostile" to the U.S. interests.

While this comes as no surprise to any observer of U.S. policy or the oil industry, the JMMC has been cited in several so-called "false news" stories that are on the rise of late.

For example, even though Iraq this week was the latest member to profess it was approaching full compliance with the OPEC reduction accord, state officials to date have released rhetoric rather than data to support their claims, and this pattern continues with reports that the JMMC has praised OPEC members for complying with the cartel's production cut figures – thus furthering the impression that the cuts have indeed been implemented.

The JMMC, which is composed of three OPEC Members – Algeria, Kuwait, and Venezuela, and two non-OPEC countries – Russia and Oman – "expressed its satisfaction regarding the strong level of commitment to the agreed framework," according to a press release issued by OPEC.

And while this has become the leading headline for a number of news agencies, the inaugural meeting in Vienna that inspired the expression of satisfaction consisted mainly of the committee agreeing to "facilitate the exchange of joint analyses and outlooks, which will provide valuable input to the evaluation of the conformity."

In short, it not only remains to be seen if compliance has truly been achieved, the mechanism by which compliance is measured is still being worked out.

The meeting concluded with the stipulation that the OPEC Secretariat present a monthly production data report on OPEC member countries' crude oil and of the participating non-OPEC oil liquid production to the JMMC by the 17th of each upcoming month: "Evaluation of conformity to the respective country production adjustment will be based on production data only."

The JMMC will also issue a monthly press release on the progress towards the implementation of the cutbacks, with input from a joint technical committee.

As confusing as the reporting of the cutback compliance has been, boosters insist it is a success, a typical recent comment being that of Khalid al-Falih, energy minister for Saudi Arabia, who told reporters earlier this week that "the actions taken by the Kingdom and many other countries has impacted the market in a tangible way and we have seen the impact in spot prices."