Non-OPEC Oil Cutback Compliance "at Least 60%", While US Exports Continue at Record Highs

Oil exports from the US have continued at record highs.

While Organization of Petroleum Exporting Countries' (OPEC) compliance with the oil cutback deal may be an impressive 90 percent-plus, a review this week in Vienna has revealed non-OPEC compliance is "at least 60 percent."

While lower, the message is a positive one; the compliance level revealed by the group monitoring adherence to the agreed output levels is higher than earlier estimates of 40 percent, and higher than reports this week indicating compliance was at 50 percent.

"This meeting shows the seriousness of OPEC and non-OPEC in implementing the agreed cut," an OPEC delegate was quoted by Reuters as saying.

However, the news had no apparent impact on oil prices, adding weight to a growing chorus of voices suggesting the market has already priced in the oil cuts.

It also seems there is barely a day that goes by without a reminder of the ever growing influence of U.S. shale, and Thursday was no exception with CNBC reporting record U.S. exports of over one million barrels a day (bpd) have continued for a second week.

In all, exports from the U.S. hit 1.2 million bpd last week, up 350,000 bpd from the four-week average, according to data from the Energy Information Administration.

Last week's production rose to 9 million bpd, the highest level since April 2016.

"OPEC's got a competitor. No doubt about it," said Ion Energy Group's Kyle Cooper.

"They certainly have to be concerned with U.S. oil producers eating into their market share."

With positive messages on cutback compliance clearly unable to lift prices, earlier this week ABN Amro Bank senior energy economist Hans van Cleef said the "downside risk [for oil] has become much bigger than previously."

The sentiment is one that is presumably shared by OPEC secretary-general Mohammad Barkindo, who this week said that anything less than 100 percent compliance with the oil cutback deal "is not satisfactory."