OPEC should approach Libya and Nigeria, the two exempted OPEC members who were allowed to continue raising their crude oil output despite the November 2016 deal, Iran’s Oil Minister Bijan Namdar Zanganeh told media. The official said that OPEC members are compliant with their lower production quotas at an “acceptable” level, but rising supply from Libya and Nigeria is hampering the cartel’s efforts to rebalance the oil market.
“OPEC’s actions are working and compliance is acceptable overall, although there needs to be some change,” Zanganeh said, as quoted by Bloomberg. “Changes are really related to Libya and Nigeria and the 100 percent compliance of everyone.”
Rising production from the two exempt OPEC members—chiefly from Libya—has indeed slowed down the oil price improvement that OPEC targeted with its agreement. The North African country set a target of pumping more than 1 million bpd by the end of July, and it reached it early on—an accomplishment that weighed heavily on benchmark prices.