Russia-Ukraine conflict a major blow to the global economy

According to the blog writers of the International Monetary Fund (IMF), Russia-Ukraine conflict is a major blow to the global economy that will hurt growth and raise prices. 

Beyond the suffering and humanitarian crisis from Russia’s invasion of Ukraine, the entire global economy will feel the effects of slower growth and faster inflation. Impacts will flow through three main channels:

1) Higher prices for commodities like food and energy will push up inflation further, in turn eroding the value of incomes and weighing on demand.

2) Neighboring economies in particular will grapple with disrupted trade, supply chains, and remittances as well as an historic surge in refugee flows.

3) Reduced business confidence and higher investor uncertainty will weigh on asset prices, tightening financial conditions and potentially spurring capital outflows from emerging markets.

Russia and Ukraine are major commodities producers, and disruptions have caused global prices to soar, especially for oil and natural gas. Food costs have jumped, with wheat, for which Ukraine and Russia make up 30% of global exports, reaching a record.

Beyond global spillovers, countries with direct trade, tourism, and financial exposures will feel additional pressures. Economies reliant on oil imports will see wider fiscal and trade deficits and more inflation pressure, though some exporters such as those in the Middle East and Africa may benefit from higher prices.

Steeper price increases for food and fuel may spur a greater risk of unrest in some regions, from Sub-Saharan Africa and Latin America to the Caucasus and Central Asia, while food insecurity is likely to further increase in parts of Africa and the Middle East.

Gauging these reverberations is hard, but we already see our growth forecasts as likely to be revised down next month when we will offer a fuller picture in our World Economic Outlook and regional assessments.

Longer term, the war may fundamentally alter the global economic and geopolitical order should energy trade shift, supply chains reconfigure, payment networks fragment, and countries rethink reserve currency holdings. Increased geopolitical tension further raises risks of economic fragmentation, especially for trade and technology.

Ukraine may become another Syria, Iraq or Afghanistan

It is essentially necessary to bring the war in Ukraine to an immediate end.  The longer the war continues the more complicated it will become to resolve.

The Soviet war on Afghanistan in the 1980s brought extremists mostly from Muslim states to the landlocked country. 

The invasion made the country a safe place for terrorism to breed. The fact that al-Qaeda network used Afghanistan as a platform to advance its vicious goals is clear to all.

The war in the country led to catastrophe one after another. The extremist ideology in Afghanistan gave birth to other groups whose brutality superseded that of al-Qaeda. Daesh, also called ISIS/ISIL.

Abu Musab al-Zarqawi is quite a familiar name. Al-Zarqawi, who ran a terrorist training camp in Afghanistan, went to Iraq to quench his thirst for more bloodshed by brutalizing Iraqi civilians and soldiers after the United States invaded the country in March 2003. In fact, the war on Iraq spread the area of activity by extremists.

The chaos that followed the civil war in Syria also brought extremists to the country from dozens of countries, including Chechens from Russia. They poured into the country from Indonesia and Malaysia in Southeast Asia to those in Western European countries.

The wars in Afghanistan, Iraq and Syria are an eye opener about the dangers of extremism.

Now those extremists who used Syria, Iraq and Afghanistan as their battlegrounds, may seek to find a way to Ukraine, especially as the domain of their action has been greatly reduced in these countries. They are adventurers who have thirst to kill and don’t care who is right or wrong. This is in addition to far-right extremists from Europe and North America who are already seeking to enter or may have entered Ukraine to fight the Russians.

In a report on March 03, Brookings said, “When foreign fighters deploy, violence against civilians goes up.” It added, “Far-right militias are already declaring they plan to exploit the war in Ukraine.”

Also, in a report on February 25, one day after Russia invaded Ukraine, the New York Times reported, “The Russian attack on Ukraine has prompted a flurry of activity among far-right European militia leaders, who have taken to the internet to raise funds, recruit fighters and plan travel to the front lines to confront the country’s invaders.” The Times used the SITE Intelligence Group, a private organization that specializes in tracking extremist groups, as its source.

Before it is too late and extremists turn their guns against Ukrainians all must work hard to end the conflict. Failure to silence the guns in Ukraine could turn the country like Syria, Iraq or Afghanistan.

 

 

War in Ukraine will push Asia Europe rail cargo back to sea

A report by UNCTAD on the trade and development impact of the war in Ukraine highlighted that Russia and Ukraine form a key component of the Eurasian Land Bridge. 

Restrictions on Russian air space, contractor uncertainty and security concerns, all impact both land and air cargo shipments between Asia and Europe.

“While Russian airspace is closed to 36 countries and vice versa, some freight forwarders currently recommend not booking overland shipments between Asia and Europe,” UNCTAD said.

Over the last two years of the pandemic and resulting global supply chain disruption shippers have increasingly turned to rail, air, and even trucking, from China to Europe to beat congestion on the ocean shipping trade between Asia and Europe that has driven freight rates to record levels, and dramatically reduced service reliability.

“In 2021, 1.5 million ocean containers of cargo were shipped by rail west from China to Europe. If the volumes currently going by container rail were added to the Asia – Europe ocean freight demand, this would mean a 5 to 8% increase in an already congested trade route,” the report stated.

The result could be even higher freight rates between Asia and Europe for ocean freight given the constrained capacity situation on the trade, even if at present rates were trending downwards from record highs.

“This is related more to a global trend in the easing of pandemic lockdowns and phasing out of stimulus packages, vis-à-vis slowly improving congestion in some port areas of the world. Upward pressure on prices, however, may soon win out on balance,” UNCTAD said.

With nearly 30 million people locked down in China over Omicron outbreaks, including 17 million in the southern port city of Shenzhen, analysts are warning of huge potential impact on the container supply chain if the situation worsens. Already there are reports of growing queues of ships at ports such as Yantian as while ports remain operating normally, warehouses and factories are closed, and trucking is restricted.

 

Get ready to trade in Russian Gold and Chinese Petroyuan

According to Information Clearing House, for a long time the world has been waiting to end trade in the currency of United States. The trade war initiated by United States against Russia and China indicate that finally some key contours of the foundations on new multipolar world have started appearing.

After a recent videoconference meeting, the Eurasian Economic Union (EAEU) and China agreed to design the mechanism for an independent international monetary and financial system.

The EAEU consists of Russia, Kazakhstan, Kyrgyzstan, Belarus and Armenia, is establishing free trade deals with other Eurasian nations, and is progressively interconnecting with the Chinese Belt and Road Initiative (BRI).

For all practical purposes, the idea comes from Sergei Glazyev, Russia’s foremost independent economist, a former adviser to President Vladimir Putin and the Minister for Integration and Macroeconomics of the Eurasia Economic Commission, the regulatory body of the EAEU.

In this article, Glazyev’s key role in devising the new Russian and Eurasian economic/financial strategy has been examined. He saw the western financial squeeze on Moscow coming light-years before others.

Quite diplomatically, Glazyev attributed the fruition of the idea to the common challenges and risks associated with the global economic slowdown and restrictive measures against the EAEU states and China.

Since China is as much a Eurasian power as Russia, both the countries need to coordinate their strategies to bypass the US unipolar system.

The Eurasian system will be based on a new international currency, most probably with the yuan as reference, calculated as an index of the national currencies of the participating countries, as well as commodity prices. The first draft will be discussed by the end of March this year.

The Eurasian system is bound to become a serious alternative to the US dollar, as the EAEU may attract not only nations that have joined BRI (Kazakhstan, for instance, is a member of both) but also the leading players in the Shanghai Cooperation Organization (SCO)as well as ASEAN. West Asian actors – Iran, Iraq, Syria and Lebanon – will be inevitably interested.

In the medium to long term, the spread of the new system will translate into the weakening of the Bretton Woods system, which even serious US market players/strategists admit is rotten from the inside. The US dollar and imperial hegemony are facing stormy seas.

Meanwhile, Russia has a serious problem to tackle. This past weekend, Finance Minister Anton Siluanov confirmed that half of Russia’s gold and foreign reserves have been frozen by unilateral sanctions. It boggles the mind that Russian financial experts have placed a great deal of the nation’s wealth where it can be easily accessed – and even confiscated.

At first it was not exactly clear what Siluanov had meant. How could the Central Bank’s Elvira Nabiulina and her team let half of foreign reserves and even gold be stored in Western banks and/or vaults? Or is this some sneaky diversionist tactic by Siluanov?

No one is better equipped to answer these questions than the inestimable Michael Hudson, author of the recent revised edition of Super Imperialism: The Economic Strategy of the American Empire.

Hudson was quite frank, he said “When I first heard the word ‘frozen,’ I thought that this meant that Russia was not going to expend its precious gold reserves on supporting the ruble, trying to fight against a Soros-style raid from the west. But now the word ‘frozen’ seems to have meant that Russia had sent it abroad, outside of its control.”

“It looks like at least as of last June, all Russian gold was kept in Russia itself. At the same time it would have been natural to have kept securities and bank deposits in the United States and Britain, because that is where most intervention in world foreign exchange markets occurs,” Hudson added,

Essentially, it is all still up in the air, “My first reading assumed that Russia must be doing something smart. If it was smart to move gold abroad, perhaps it was doing what other central banks do, lend it to speculators, for an interest payment or fee. Until Russia tells the world where its gold was put, and why, we can’t fathom it. Was it in the Bank of England – even after England confiscated Venezuela’s gold? Was it in the New York Fed – even after the Fed confiscated Afghanistan’s reserves?”

So far, there has been no extra clarification either from Siluanov or Nabiulina. Scenarios swirl about a string of deportations to northern Siberia for national treason. Hudson adds important elements to the puzzle.

“If the reserves are frozen, why is Russia paying interest on its foreign debt falling due? It can direct the freezer to pay, to shift the blame for default. It can talk about Chase Manhattan’s freezing of Iran’s bank account from which Iran sought to pay interest on its dollar-denominated debt.

It can insist that any payments by NATO countries be settled in advance by physical gold. Or it can land paratroopers on the Bank of England, and recover gold – sort of like Goldfinger at Fort Knox. What is important is for Russia to explain what happened and how it was attacked, as a warning to other countries.”

As a clincher, Hudson could not but wink at Glazyev: “Maybe Russia should appoint a non-pro-westerner at the central bank.”

It’s tempting to read into Russian Foreign Minister Sergey Lavrov’s words at the diplomatic summit in Antalya last Thursday a veiled admission that Moscow may not have been totally prepared for the heavy financial artillery deployed by the Americans.

“We will solve the problem – and the solution will be to no longer depend on our western partners, be it governments or companies that are acting as tools of western political aggression against Russia instead of pursuing the interests of their businesses. We will make sure that we never again find ourselves in a similar situation and that neither some Uncle Sam nor anybody else can make decisions aimed at destroying our economy. We will find a way to eliminate this dependence. We should have done it long ago.”

One of its planks will be the Eurasian financial system. Meanwhile, the market (as in, the American speculative casino) has judged (according to its self-made oracles) that Russian gold reserves – the ones that stayed in Russia – cannot support the ruble.

That’s not the issue – on several levels. The self-made oracles, brainwashed for decades, believe that the Hegemon dictates what the market does. That’s mere propaganda. The crucial fact is that in the new, emerging paradigm, NATO nations amount to at best 15 percent of the world’s population. Russia won’t be forced to practice autarky because it does not need to most of the world – as we’ve seen represented in the hefty non-sanctioning nation list – is ready to do business with Moscow.

Iran has shown how to do it. Persian Gulf traders confirmed that Iran is selling no less than 3 million barrels of oil a day even now, with no signed JCPOA (Joint Comprehensive Plan of Action agreement, currently under negotiation in Vienna). Oil is relabeled, smuggled, and transferred from tankers in the dead of night.

Another example, Indian Oil Corporation (IOC), a huge refiner, just bought 3 million barrels of Russian Urals from trader Vitol for delivery in May. There are no sanctions on Russian oil – at least not yet.

Washington’s reductionist, Mackinderesque plan is to manipulate Ukraine as a disposable pawn to go scorched-earth on Russia, and then hit China. Essentially, divide-and-rule to smash not only one but two peer competitors in Eurasia who are advancing in lockstep as comprehensive strategic partners.

As Hudson sees as, “China is in the cross-hairs, and what happened to Russia is a dress rehearsal for what can happen to China. Best to break sooner than later under these conditions. Because the leverage is highest now.”

All the blather about crashing Russian markets, ending foreign investment, destroying the ruble, a full trade embargo, expelling Russia from the community of nations, and so forth –that’s for the zombified galleries. Iran has been dealing with the same thing for four decades, and survived.

Historical poetic justice, as Lavrov intimated, now happens to rule that Russia and Iran are about to sign a very important agreement, which may likely be an equivalent of the Iran-China strategic partnership. The three main nodes of Eurasia integration are perfecting their interaction on the go, and sooner rather than later, may be utilizing a new, independent monetary and financial system.

But there’s more poetic justice on the way, revolving around the ultimate game-changer. And it came much sooner than we all thought.

Saudi Arabia is considering accepting Chinese yuan – and not US dollars – for selling oil to China. Beijing told Riyadh this is the new groove. The end of the petrodollar is at hand – and that is the certified nail in the coffin of the indispensable Hegemon.

 

Five takeaways from Zelensky virtual address to US Congress

Ukrainian President Volodymyr Zelensky brought a moment of enormous drama to Washington Wednesday, when he gave a virtual address to Congress. Dressed in his trademark military-green t-shirt, pleaded for help as his nation tries to fend off the Russian forces who invaded three weeks ago. 

His speech was relatively brief, lasting around 15 minutes, but carried hefty emotional force. Lawmakers gave him a standing ovation at its beginning and at its conclusion.

Here are the major takeaways:

 Sticks with no-fly zone

The Ukrainian president is not budging from his demands for the imposition of a "no-fly" zone. It’s an uncomfortable request, not just for President Biden but for American lawmakers in general.

Sympathy for the plight of Ukraine is widespread but so too is wariness about getting sucked into a wider conflict. Such an outcome would seem almost unavoidable if a no-fly zone were imposed since, by its nature, it would require US warplanes to be willing to shoot down their Russian counterparts.

Zelensky, with his life and his country on the line, doesn’t see it that way.

“Is this a lot to ask for, to create a no-fly zone over Ukraine to save people? Is this too much to ask for?” he demanded.

There seems little chance of him changing Biden’s mind, or the consensus on Capitol Hill, on that particular issue.

Zelensky did suggest a slightly less emphatic option — the provision of warplanes and air defenses. Those ideas are the most likely to be at the center of US American political debate in the days to come.

The mere fact of the Ukrainian’s president address may have moved the needle in another way though. 

Biden was expected to announce another huge tranche of military aid — valued at around $800 million — just hours after Zelensky finished speaking.

Brings conflict to American public

Zelensky has done everything to try to bring the scale of the crisis home to western lawmakers, and the citizens who elect them. 

On Tuesday, he spoke to the Canadian Parliament, addressing that nation’s Prime Minister, Justin Trudeau, simply Justin and asking lawmakers to imagine attacks on Toronto or Vancouver. 

Last week, addressing the British parliament, Zelensky invoked William Shakespeare and Winston Churchill.

Before Congress he reached for a litany of American references, from the attack on Pearl Harbor to Dr. Martin Luther King’s famous “I Have a Dream” speech.

“In your history, you have pages that would enable you to understand Ukrainians,” Zelensky said.

If the US is to maintain sanctions, keep funneling aid, and perhaps get even more deeply involved in Ukraine, the American public need to stay engaged and be willing to pay a price of its own.

Zelensky’s remarks were as much a plea to the American people as to American politicians.

Criticizes Biden Administration

Republicans have become more critical of the Biden administration of late.

Senate Minority Leader Mitch McConnell said on Tuesday that the US president had been guilty of “hesitancy and weakness.” Sen. James Risch complained that aid to Ukraine had been “too little, too late, too slow.”

The administration counters that it is wary of “escalatory” measures that might embroil the US and its allies in a direct war with Russia — something which Biden has said would amount to “World War Three.”

Even as Zelensky paid tribute to Biden’s “sincere commitment” to defending his nation, and to democracy more generally, the Ukrainian president said enough to give an opening to the president’s more hawkish critics.

Zelensky’s push for warplanes was especially powerful and pointed, coming in the wake of an awkward episode in which the White House rebuffed Poland’s offer to send MiG-29 jets to Ukraine via a US military base in Germany. 

Referring to such planes, Zelensky said, “You know they exist. You have them, but they are on earth, not in the Ukrainian sky.”

Zelensky also argued that the US needed to show global leadership by supplying more aid. 

That suggestion carried the implication that the US would be seen as abdicating its role if it declined more direct assistance.

Calls for a new international body

One of the surprises in the speech was Zelensky’s call for a new international body. 

He suggested it should be called “U24” or “United for Peace” that would, in theory, act to stop conflicts immediately.

Whatever the desirability of such an idea, there is no real chance of it being created amid the current crisis, when there is plenty of other international activity going on. Biden is headed to Brussels next week for an extraordinary meeting of NATO members. He will also meet European Union while overseas. 

But Zelensky’s proposal may have had another purpose — it distracted from any new scrutiny on the central issue of whether Ukraine could join NATO in the medium-term. 

The question is sure to be a pivotal one to the ongoing negotiations between Ukraine and Russia — and the idea of Ukrainian membership of NATO is abhorrent to Russian President Vladimir Putin.

Zelensky offered a rhetorical concession on this point on Tuesday when he suggested Ukrainians had to accept that “we cannot enter” the alliance in the short term. 

On Wednesday, British Prime Minister Boris Johnson acknowledged that “the reality of the situation” is that Ukraine will not be a member of NATO “anytime soon.”

Zelensky said nothing germane on the topic during his congressional address. 

Stuns lawmakers

Zelensky, a former comic actor and TV star, has gained the upper hand over his Russian adversaries in one area ever since the crisis began — communications.

He has pressed his nation’s case in formal addresses like Wednesday’s and also with frequent tweets and social media videos.

While his Wednesday speech was itself impressive, the most emotive moment came when Zelensky paused to show a video. 

The short film juxtaposed images of a happier, more relaxed Ukraine with scenes of appalling suffering, many of them involving child victims.

Some lawmakers were reportedly moved to tears by the video — and they won’t have been the only ones.

 

 

Ukrainian president being portrayed as war time hero by western media

Ukrainian President Volodymyr Zelensky will make a direct appeal in an address to members of Congress and the United States on Wednesday as Russia continues its assault on Kyiv and President Biden plots a trio of his own to Europe next week.

Exactly three weeks into the war, Zelensky is expected to heap pressure on lawmakers and the public as he continues his push for the United States and its European allies to increase its support militarily for Ukraine as Russian forces continue to make inroads throughout the country.

The address will be Zelensky’s second to members of Congress, having talked to 300 of them during a Zoom call earlier this month. However, the speech marks the first time he will address the American public and make a direct call for help.

On Tuesday, Biden signed into law the year-end government spending bill, which included nearly US$14 billion in humanitarian and military aid for the war-torn nation. The aid, which Congress OK’d last week, comes after Biden barred imports of Russian oil and levied heavy sanctions on the Russian economy. Biden also could be on the verge of announcing an additional US$1 billion in new military aid for Ukraine.

Zelensky is expected to ask for more. His appeal will take place a day after two other speeches to the British Parliament and Canada’s House of Commons, where he pleaded for support for a no-fly zone over his country and requested further assistance in the deadly conflict with Moscow. He also directed questions at Canadian Prime Minister Justin Trudeau, asking him to imagine what it would be like if Canadians were the ones being attacked.

“Dear Justin ... can you imagine every day you receive memorandums about the number of casualties including women and children? You heard about the bombings. Currently, we have 97 children that died during this war,” Zelensky said.

Zelensky’s pitch to Congress comes amid continued tumult in Kyiv, where the Russian military has continued its assault, including on Tuesday. Kyiv Mayor Vitali Klitschko said that missile strikes killed four more individuals in the Ukrainian capital, having also put the city under a 35-hour curfew amid a “difficult and dangerous” moment.

Adding to the drama in Kyiv, the prime ministers of Poland, Czech Republic and Slovenia became the first world leaders to travel to the city since the fighting began 21 days ago. Petr Fiala, the Czech prime minister, wrote in a Facebook post that the visit was meant to “to confirm the unequivocal support of the entire European Union for the sovereignty and independence of Ukraine.” 

As for Biden, the White House announced on Tuesday that he will visit Brussels on March 24 for discussions with European leaders, including a NATO summit and a separate one with the European Council.

“We’ve been incredibly aligned to date,” White House press secretary Jen Psaki said of the US cooperation with European nations on the Ukraine situation. “That doesn’t happen by accident. The president is a big believer in face-to-face diplomacy. So it’s an opportunity to do exactly that”.

Meanwhile, the Russian government on Tuesday imposed its own set of sanctions against top U.S. officials, including Biden, Secretary of State Antony Blinken and Defense Secretary Lloyd Austin. The move blocks the three, among others, from entering Russia. According to Bloomberg News, the Russian Foreign Ministry added that the sanctions would not stand in the way of high-level contacts if needed.

Why oil prices slip below US$100 per barrel?

Oil prices have slipped below US$100/barrel this week despite the ongoing war in Ukraine and a structurally tight market. To understand the factors moving oil markets, make sure you sign up this blog to get regular updates.

The return of Iranian oil to markets is back on the global agenda after Moscow received guarantees that it could continue trading with Iran after sanctions are lifted. This news sent crude prices below the US$100/barrel mark, the lowest level in three weeks.

The reappearance of COVID-19 in China only added to the downward pressure in oil markets as the country hit a two-year high of 3,500 cases on Monday, doubling day-on-day. Stringent curbs were reintroduced in many major cities, most notably Shanghai and Shenzhen being put under lockdown.

This raises fears that Chinese demand over the upcoming weeks might drop below the stagnating levels of first two months of 2022.

In spite of the IEA claiming that Europe could essentially halve its dependence on Russian gas imports within a year, March gas flows have so far averaged 30% higher than February. 

Leading oil majors Shell, BP, and Equinor announced they would not be trading Russian oil and products for the foreseeable future, but that is not the case with gas. 

European spot gas prices have in fact come down over the past week on higher Russian pipeline supplies, with May ‘22 TTF prices trending around US$40/mmBtu. 

Gazprom exports in January 01 to March 15 to non-CIS countries have totaled 30.7bcm, down 28%YoY, primarily on the back of Europe seeing mild weather throughout the winter season. 

European Union Endeavor

European Union member states have agreed on a fourth package of sanctions against Russia following its invasion of Ukraine. The details of the sanctions were not disclosed. It is anticipated Russia's "most favored nation" trade status would be revoked. This could open the door to the bloc banning or imposing punitive tariffs on Russian goods and putting Russia on a par with North Korea and Iran.

Sanctions were set to include an import ban on Russian steel and iron, an export ban on luxury goods including cars worth more than US$55,000 and a ban on investments in oil companies and the energy sector. They would also add Chelsea football club owner Roman Abramovich and 14 others to the EU list of sanctioned Russian billionaires, diplomats said earlier in the day.

European Commission President Ursula von der Leyen has also said the EU was working to suspend Russia's membership rights of leading multilateral institutions, including the International Monetary Fund and the World Bank.

The latest sanctions will be formally in place once they have been published in the EU's official journal, which will follow soon.

OPEC Stance

Organization of the Petroleum Exporting Countries (OPEC) said on Tuesday that oil demand in 2022 faces challenges from Russia's invasion of Ukraine and rising inflation as crude prices soar, increasing the likelihood of reductions to its forecast for robust demand this year.

Oil prices shot above US$139 a barrel this month, hitting peaks not seen since 2008, as Western sanctions tightened on Moscow over its invasion of Ukraine and disrupted oil sales from Russia, helping to fuel inflation that was already rising.

In a monthly report, OPEC stuck to its view that world oil demand would rise by 4.15 million barrels per day (bpd) in 2022 and increased its forecast of global demand for its crude.

But OPEC, which just a month ago had raised the possibility of a more rapid demand increase in 2022, said the war in Ukraine and continued concerns about COVID-19 would have a negative short-term impact on global growth.

"Looking ahead, challenges to the global economy – especially regarding the slowdown of economic growth, rising inflation and the ongoing geopolitical turmoil will impact oil demand in various regions," OPEC said in its report.

"While the year started on relatively solid underlying footing, the latest events in Eastern Europe may derail the recovery," OPEC said in its commentary on the world economy.

World oil consumption is expected to surpass the 100 million bpd mark in the third quarter, in line with OPEC's forecast last month. OPEC nudged up its forecast of the year's total oil use by about 100,000 bpd to 100.90 million bpd.

On an annual basis, OPEC said the world last used more than 100 million bpd of oil in 2019.

Oil prices extended their earlier decline after the report was issued, trading further below US$99/barrel on the perception of easing supply risks.

The report also showed higher output from OPEC as the group and allied non-members, known as OPEC+, gradually unwind record output cuts put in place in 2020.

OPEC+ has aimed to raise output by 400,000 bpd a month, with about 254,000 bpd of that due from 10 participating OPEC members, but production has been increasing by less than this as some producers struggle to pump more.

Still, the report showed OPEC output in February bucked that trend and rose by 440,000 bpd to 28.47 million bpd, driven by higher supply from top exporter Saudi Arabia and a recovery from outages in Libya.

The growth forecast for overall non-OPEC supply in 2022 was left unchanged, as was that for production of US tight oil, another term for shale.

OPEC said it expects the world to need 29 million bpd from its members in 2022, up 100,000 bpd from last month and theoretically allowing further increases in output.