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IMF ups oil price forecast

Wednesday, January 18
The International Monetary Fund (IMF) has increased the forecast for the average oil price for 2017 by $0.6 to $51.2 per barrel, according to IMF’s updated World Economic Outlook.

This World Economic Outlook incorporates a firming of oil prices following the agreement among OPEC members and several other major producers to limit supply.

The assumed price based on futures markets (as of December 6, 2016) is $53.1 in 2018, according to IMF.

In the Middle East, growth in Saudi Arabia is expected to be weaker than previously forecast for 2017 as oil production is cut back in line with the recent OPEC agreement, said the report.

During the Vienna meeting held Nov.30, OPEC members decided to implement a new OPEC-14 production target of 32.5 million barrels per day.

It was also decided to establish a High-level Monitoring Committee, consisting of oil ministers, and assisted by the OPEC Secretariat, to monitor the implementation of the agreement.

Later, non-OPEC countries agreed to cut the oil output by 558,000 barrels per day during the meeting held Dec.10.

Eleven non-OPEC countries agreed to reduce the oil output: Azerbaijan, Kingdom of Bahrain, Brunei Darussalam, Equatorial Guinea, Kazakhstan, Malaysia, Mexico, Sultanate of Oman, the Russian Federation, Republic of Sudan, and Republic of South Sudan.

OPEC and non-OPEC countries pledged to implement the reached deal from January 1 2017. (