U.S. shale oil producers have not been able to withstand the decline in global oil prices as much as producers in the OPEC group, which includes Middle Eastern nations, Venezuela and Nigeria among others.
Many analysts believe OPEC was happy to maintain record high production levels (rather than cut production in a bid to support prices) in order to defend its market share and put rival shale oil producers out of business.
The strategy appears to be bearing fruit, with producers in the U.S. and Canada closing rigs and cancelling drilling projects, a trend that OPEC believed would continue into 2016.
"In 2016, the postponing or cancelling of upstream projects will likely continue, resulting in contraction of 130,000 b/d in non-OPEC supply," OPEC said, adding that "U.S. oil supply in 2016 is expected to decline by 100,000 b/d."
Adding to the gloom, and perhaps more than a whiff of schadenfreude, OPEC signalled that the declines in non-OPEC supply could be even worse than forecast.
"The 2016 forecast for non-OPEC supply is associated with a high level of uncertainty. Oil price fluctuations and technical challenges – such as unplanned shutdowns and sharper-than-expected decline rates – along with geopolitical conditions could affect non-OPEC supply in the coming year."