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ENERGY NEWS Mohammad Barkindo said at the meeting of the Joint Ministerial Monitoring Committee (JMMC) which preceded the OPEC+ ministerial meeting.
MIDDLE EAST
“As with the economy, the market outlook for later this year looks especially promising. In fact, we anticipate that demand will surpass 99 mb/d in the fourth quarter, which would put us back in the range of pre-pandemic levels,” Barkindo added.
OPEC Continues To Expect Strong Oil Demand Rebound
Energy Review
A week and a half later, OPEC’s Monthly Oil Market Report (MOMR) for June reiterated the organisation’s view that global oil demand, driven by the economies in the United States and China, will rebound strongly in the second half of the year.
By Tsvetana Paraskova
Although the economic recovery was delayed at the start of the second quarter due to the COVID resurgence in India, Japan, and some parts of the Eurozone, the advance in vaccinations and the easing of restrictions “lend optimism that the pandemic could be contained in the few months to come,” OPEC said in the report.
The monthly meeting of the OPEC+ alliance, OPEC’s optimistic outlook on global oil demand this year, and Global oil a flurry of oil and gas demand is also contracts feature in this month’s overexpected to pick view of the oil and up pace in the gas industry in the second half Middle East.
of 2021
OPEC+ Keeps Plans To Ease Production Cuts During a quick meeting on 1 June, OPEC and its non-OPEC partners led by Russia reaffirmed the previously endorsed plan to ease the collective oil production cuts by 2 million barrels per day (bpd) by July. The OPEC+ group’s oil production is set to rise by 350,000 bpd in both May and June and by more than 400,000 bpd in July. Additionally, Saudi Arabia is currently also gradually easing its extra unilateral cut of 1 million bpd by July. The OPEC+ decision to stick to the plan for unwinding part of the oil output cuts signalled once again to the market that the group is confident that rising demand as economies recover from the pandemic would absorb the additional supply. “The Meeting noted the ongoing strengthening of market fundamentals, with oil demand showing clear signs of improvement and OECD stocks falling as the economic recovery continued in most parts of the world as vaccination programmes accelerated,” OPEC said in a statement. “The projections for oil are largely unchanged from our last meeting, with demand expected to grow by 6 mb/d to around 96.5 mb/d on average for the year, an increase of 6.6%,” OPEC Secretary General
www.ogv.energy I July 2021
As a result, global oil demand is also expected to pick up pace in the second half of 2021, reaching 99.0 million bpd, up from 94.1 million bpd in the first half, with improving mobility in major economies supporting petrol and on-road diesel demand. OECD Americas is forecast to be the largest contributor to oil demand growth in 2021, according to OPEC, although overall oil demand in the region is not expected to fully recover from the 2020 slump. In the developing economies, oil demand growth will be driven by China and other Asian markets including India, despite the coronavirus resurgence in the second quarter, OPEC noted. “A healthy rebound in economic momentum is anticipated to stimulate industrial fuel demand, while demand for petrochemical feedstock is also projected to support demand growth in 2021,” the organisation said. “Overall, the recovery in global economic growth, and hence oil demand, are expected to gain momentum in 2H21,” OPEC said. OPEC’s optimism, combined with signs of continued demand growth at the start of
