ST. PETERSBURG, 24th July, 2017 (WAM) -- The oil market is making steady and significant progress towards rebalancing, said the Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) in a statement following its 4th meeting in St. Petersburg, Russia, on Monday.

This assertion was based on the report of the Joint OPEC-Non-OPEC Technical Committee (JTC) for the month of June 2017, which reviewed the market developments and the results of the first six months of progress, according to OPECs 171st Ministerial Conference Decision and the respective voluntary adjustments in line with the Declaration of Cooperation.

''The continued strengthening of the global recovery is underway, with stability in the oil market remaining a key determinant. The market volatility has been lower in recent weeks and investment flows have visibly started to improve in the industry,'' the statement added.

According to the JTC report, there are several positive indicators going forward. Oil demand is expected to increase significantly in the 2H17 compared to 1H17, with the growth reaching a level of 2 million barrels per day (mb/d), which should sustain the inventory draws.

Furthermore, the participating OPEC and Non-OPEC producing countries achieved a conformity level of 98 percent in June 2017. In addition, the same level of high conformity was observed from January to June 2017. Between those months, the participating producing countries adjusted their production downwards by an estimated volume of 351 mb. Also, the overhang of OECD commercial oil stocks over the five-year average level has fallen by 90 mb for the period January to June 2017 and now stands at 250 mb.

The JMMC noted that despite the high level of conformity at the aggregate level, there was still room for improvement by some participating producing countries, and demanded that these countries promptly reach full conformity. Consequently, the JMMC has had serious discussions with those countries and will continue to engage with all participating countries individually, in particular, those that are yet to achieve 100 percent conformity for the remaining period of the Declaration of Cooperation.

The JMMC will continue to monitor and recommend further action including the holding of an extraordinary conference of the 24 producing countries if needed.

The JMMC also recommended keeping the extension of the Declaration of Cooperation beyond 1Q18 as an option, should further action be required for the stabilisation of the market.

The 5th meeting of the JMMC is scheduled to take place in September 2017, or earlier if deemed necessary.

Copyright Emirates News Agency (WAM) 2017.