For the record, on Sunday Mohammad Barkindo, secretary-general of OPEC, said in India that "extraordinary measures" may be required to sustain a re-balancing process he believes is underway; this was followed by Saudi Arabia claiming it will limit November allocations of crude by an "unprecedented" amount.
US crude oil inventories fell by 4.08 million barrels last week, the American Petroleum Institute said on Tuesday, far more than expected while gasoline supplies gained 4.91 million barrels and distillates eased by 584,000 barrels.
Saudi Arabia and Russian Federation, he said, are leading the initiative to bring in more producers.
"But given our projected future demand for oil, with our upcoming World Oil Outlook 2017 expecting demand to reach over 111 million barrels a day by 2040, an increase of nearly 16 million barrels a day, the world simply can not afford a supply crunch". But US production has soared by nearly 10 per cent this year, driven largely by shale drillers.
"Despite very strong demand from worldwide waterborne customers at more than 7.711 million bpd, they were allocated only 7.150 million bpd", the spokesman said in a statement.
Pradhan had earlier raised the issue of premium being charged on oil supplied to Asian countries by some OPEC members when the two last met in Vienna in May this year for the 2nd India-OPEC Institutional Dialogue. "We were both pleasantly surprised with the outcome and the call by independents themselves that we need to continue this interaction and we are looking forward to reconvening these meetings with them shortly", he said. The OPEC delegation was also informed of the recent import of 2 cargos of crude oil from U.S. to Indian refineries.
"And once we are able to restore the balance, that equilibrium price will materialise and that will be of the best interest of the global economy", he said. From January to now, we have seen 100 per cent conformity to supply adjustments, coupled with positive response and robust demand growth.
The last three to four months, Barkindo said, saw a massive destocking, with the market structure switching to backwardation, thereby, deeming storage to be uneconomic.
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