OPEC said world demand for its oil would be higher than expected this year as supply growth from rivals including US shale producers slows, pointing to a tighter market if the exporter group refrains from raising output.
Top exporter Saudi Arabia cut output despite oil prices hitting 2019 high above $US75 a barrel and US President Donald Trump urging action to lower prices.
Supply losses in OPEC members Iran and Venezuela, both under US sanctions, have deepened the impact of an OPEC-led production-limiting deal. The so-called OPEC+ group of producers meets next month to review whether to maintain the pact beyond June.
OPEC trimmed its estimate of oil supply growth from outside the group in 2019 and said the rapid rise in production of US tight oil was moderating. "Supply growth is likely to be slower than last year amid the expected weaker global economic growth," OPEC said.
OPEC, Russia and other non-member producers are reducing output by 1.2 million barrels per day (bpd) from January 1 for six months. The producers meet on June 25-26 to decide whether to extend the pact.
OPEC estimates it needs to provide an average of 30.58 million bpd in 2019 to balance the market, a figure increased by 280,000 bpd month-on-month partly due to the lower non-OPEC supply outlook.
This suggests there will be a 2019 supply deficit of over 500,000 bpd if OPEC keeps pumping at April's rate of just over 30 million bpd and other things remain equal. Last month's report had indicated a smaller deficit.