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Oil yields of OPEC accelerated in May 2017 to the highest level since November 2016, while its members were trying to extend the agreement for limiting of production. The reason is that Nigeria and Libya increased their production and compensated the reduction of the other cartel’s members. Both countries were released from the mining deal negotiated between the major producer countries.

The data of the OPEC Monthly Oil Market Report illustrate the latest challenges for the group, which is already struggling with the renewed decline in prices and the reviving American shale industry.

Although production in Nigeria and Libya remains volatile due to political instability and violence, their combined yields has increased by more than 350,000 barrels per day in the last month. This volume is equivalent to more than a quarter of the OPEC yield reduction since the beginning of the year. Libya and Nigeria contributed to raising OPEC’s total production to 32.1 million barrels per day, compared with 31.8 million barrels per day a month ago. The level is still below 33 million barrels per day, which was the average for the group in the last three months of 2016, before OPEC negotiated the deal.

Meanwhile, OPEC maintained its forecast for global demand for crude oil in 2017 at 96.38 million barrels per day. There is also no change from the estimate of the growth rate of demand in the world this year, which will be 1.27 million barrels per day. The demand for black gold produced by cartel members, according to the organization’s forecast, will be 300,000 barrels per day more than in 2016, or 32 million barrels per day.

Separate data from the OPEC Analysis Unit showed that the average barley oil price produced by the organization in 2016 amounted to 40.46 USD, while an year earlier it was 49.49 USD.

