Last October, 10 of OPEC`s 12 opec members – last October in Doha, Qatar and two months later in Abuja, Nigeria – pledged to withdraw a total of 1.7 million barrels of crude oil per day from the international market. The first agreement, which came into force on 1 November, reduced the production ceiling from 1.2 million.b/d to 26.3 million .b/d, while the second agreement resulted in a further reduction of 500,000 b/d and came into force on 1 February. Empirical analysis shows that OPEC membership is strongly and positively correlated with the level of diplomatic recognition, indicating that OPEC members are more likely to be recognized diplomatically (and vice versa, other countries recognize) than comparable non-OPEC members. The results also indicate (in the second model) that this applies to all OPEC members, not just Saudi Arabia. (Additional tests that have not been shown also indicate that OPEC membership is also beneficial for „non-nuclear“ OPEC members.) The results are also consistent when the shape of dependent variables is changed to the number of ordination albums (ordered probit model, column 3). As with the exhaustion analysis, regression models were subjected to a battery of robustness tests. For example, I have included additional variables such as dyadic fixed effects, a Cold War decoy and the flow of international trade; I have also tried to drop some variables, such as joint OPEC membership; and I tried to replace the variable of oil-producing dummies with a continuous measure of oil production (linear and recorded). None of these changes significantly changed the statistical significance of OPEC variables (see appendix). Footnote 85 Table 1. Relationship between OPEC quotas and production, 1982-2009 When OPEC members grew tired of multi-year supply competition, with lower yields and reduced financial reserves, the organization finally attempted to cut production for the first time since 2008.
Despite many political obstacles, a September 2016 decision to reduce about 1 million barrels per day was codified by a new quota agreement at the OPEC conference in November 2016. The agreement (which exempted Libya and Nigeria from troubled members) extended into the first half of 2017, in addition to the cuts promised by Russia and 10 other non-members, offset by expected increases in the US shale sector, Libya, Nigeria, unused capacity and increased OPEC production at the end of 2016, before the cuts came into effect. Indonesia has announced a new „temporary suspension“ of its OPEC membership, instead of accepting the 5% production cut requested by the organization. Prices fluctuated around $50/bbl and in May 2017 OPEC decided to extend the new quotas until March 2018, with the world waiting to see if and how the amount of oil floods could be fully depleted by then.        Long-time oil analyst Daniel Yergin „described the relationship between OPEC and shale as „mutual coexistence,“ with both sides learning to live with lower prices than they would like.“  These production cuts in non-OPEC countries are generally referred to as OPEC.   In his speech last week, Helima Croft, head of commodities at RBC in the United States.