Oil prices on Wednesday, February 15, slumped over concerns that the Organization of Petroleum Exporting Countries producers would not be able to maintain their high compliance so far with output cuts.
Brent crude LCOc1 was trading at $55.83 per barrel at 0800 GMT (3 a.m. ET), down 14 cents from its last close.
U.S. West Texas Intermediate (WTI) crude CLc1 was down 23 cents at $52.97 per barrel, Reuters reports.
The cartel and other producers including Russia agreed in December to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017.
BMI Research said that, based on an estimated compliance with planned production cuts of 92.8 percent by OPEC alone, output was down 1.08 million bpd, led primarily by deep cuts from OPEC’s de-facto leader Saudi Arabia.
But BMI warned that a compliance rate of just 40 percent by Iraq, OPEC’s second-biggest producer, “could prove problematic to group cohesion” as others will have to go beyond their targets to meet the overall goal for the first half of 2017.
Some traders said upcoming oil field maintenance across the Middle East might help the group achieve production cuts.
