"It is no secret to anyone that OPEC and USA shale producers have been battling each other in a production war since the dramatic decline in the price of oil has begun three years ago; however, each party would benefit from a stronger price of oil in the medium to longer term", said Ahmad.
"These strong and positive signs are evidence that the fundamentals of supply and demand are gradually but steadily returning to balance", he said.
"OPEC and key non-OPEC oil producers continue to successfully drain the oil market of excess barrels".
For 2017, it forecast a rise of 380,000 bpd to 9.24 million bpd.
"It would be ambitious to expect shale producers to join the current production cut agreement, but the same could have been said for OPEC working with non-OPEC members to limit production output, and this has actually taken place".
The market expects USA crude oil inventories to have fallen by 1.8 MMbbls (or million barrels) between September 29, and October 6.
OPEC and its allies want to bring stocks down to the five-year average and are discussing extending their supply restraint.
"Oil prices are expected to remain at $50-55/b in the next year", Opec said.
The report also cited headwinds in 2018 for an expansion of supplies in USA shale, such as lower drilling efficiency and cost inflation.
WTI (West Texas Intermediate) crude oil prices are now sitting at a one-week high. But analysts at JPMorgan said this was less of an issue, saying "concerns that OPEC compliance would fade into the fourth quarter now appear unfounded".
Opec said it pumped 32.75 million bpd in September, up about 89,000 bpd from August.
Currently, the EIA expects total US crude oil production to average 9.3 million bpd for 2017 and 9.8 million bpd in 2018, which would mark the highest annual average production in USA history, surpassing the previous record of 9.6 million bpd from 1970.
Rob Haworth, senior investment strategist at U.S. Bank Wealth Management said OPEC and oil bulls were "hoping U.S. producers slow down production and make further progress on inventory cuts". Should Opec keep pumping at similar levels to September, the market could move into a deficit next year, the report indicates.