(Bloomberg) -- OPEC says the global oil glut is diminishing fast. The halt to a network of vital North Sea crude pipelines means the oversupply may be about to shrink quicker still.
The stockpile glut -- including crude as well as oil products -- has decreased to 130 million barrels above the five-year average, Mohammad Barkindo, secretary general of the Organization of Petroleum Exporting Countries, said in a Bloomberg Television interview in Beijing on Wednesday. That’s an impressive contraction of the surplus given the group estimated the overhang at about 154 million barrels for September.
Disruption in the North Sea -- home to the global Brent price benchmark -- can only accelerate the rebalancing process that OPEC is spearheading alongside allies such as Russia. The halt to the Forties Pipeline System, announced earlier this week after Ineos AG discovered a 5- to 6-inch hairline crack along the base of the conduit, will remove a further 5.5 million barrels to 13 million barrels from the market by the time repairs are complete, according to data compiled by Bloomberg and company statements.
About 450,000 barrels flow through the pipeline each day and it will likely be halted for two to three weeks, Ineos Director Tom Crotty told Bloomberg TV on Tuesday. Ineos has also estimated it could take as long as four weeks. Loading programs obtained by Bloomberg show a slightly lower pumping rate: about 406,000 barrels in December.
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