Analysts believe OPEC is important for market balance, despite the problems with quota violation

Almaty. April 29. Silkroadnews – OPEC is still important to restore the balance in the oil market, the analysts at the US bank JP Morgan say.

Yet, according to the analysts’ report received by Trend, OPEC still has troubles related to the quota allocation issue.

The cartel’s members exceeding their current quota for oil production do not want to concede their share to the benefit of OPEC’s sustainable operation, analysts note. In their view, the initiatives similar the recent oil producers’ meeting in Doha may sooner or later lead to a fair distribution of the supply management burden and joining of the efforts of OPEC and non-cartel countries.

The Doha meeting did not reach an agreement on the oil production freezing at January level.

The analysts at JP Morgan believe that despite all the efforts to resume the talks, nothing serious could happen as we approach another OPEC meeting on June 2.

At present the OPEC official quota on oil production makes 30 million barrels per day.

According to the forecasts by JP Morgan analysts, OPEC oil production will proceed to grow further reaching 32.9 million barrels per day in 2016 and 33 million barrels per day in 2017.

Earlier, the head of “LUKOIL” Vagit Alekperov said due to its internal political discrepancies OPEC is not able to operate as a controller, thus, needs the reforming. According to him, the organization has no future is keeps staying within the current structure.

“It’s all possibilities got exhausted,” said V. Alekperov.

He noted it is necessary to “develop the new instruments to coordinate the actions (of countries-exporters) with each other”.