OPEC + confirms small increase in supply demand for oil rebound | Coronavirus pandemic News

World oil consumption will be claimed six million barrels a day this year, according to OPEC + estimates, even though the recovery continues to be in jeopardy due to the outbreaks of viruses in India and Brazil.

OPEC and its allies will continue their plans to slowly revive oil production as global demand recovers from the pandemic, despite the proliferation of infections in India.

The commission, led by Saudi Arabia and Russia, agreed that the coalition would have to continue with its roadmap to increase by another 2 million barrels a day in the next three months, a decision that later received a rubber stamp in a note from the entire group.

World oil consumption will fall by 6 million barrels a day this year, according to OPEC + estimates, although the recovery continues to be in jeopardy due to the outbreaks of viruses in India and Brazil. As a result, the excess of oil inventories that accumulated when demand fell last year will be almost gone by the end of this quarter.

“We can be reassured to know that our leadership has helped break the line,” Mohammad Barkindo, secretary general of the Organization of the Petroleum Exporting Countries, said on Twitter. “But at the same time, the sustainability of Covid-19 reminds us that this is not the time to stray from the prudent and firm approach we have taken over the past year.”

The OPEC + alliance reduced production last year to restore the world oil industry’s unprecedented price ramp when the pandemic suppressed fuel demand. Producers are carefully restarting these supplies as economic activity resumes, increasing by about 600,000 barrels a day in May. The group currently stands at about 8 million barrels a day, which is approximately 8% of the world’s supplies.

Market optimism

In its statement, OPEC + “highlighted the continued recovery of the global economy,” but noted that “Covid-19 cases are on the rise in several countries despite vaccinations, and that revival could hinder economic and oil demand.”

The global oil market “is positive on the one hand, we see a recovery in demand and higher GDP calculations,” Russian Deputy Prime Minister Alexander Novak told Rossiya 24 television after the OPEC + conference call. However, the team must continue to monitor the status of coronavirus in many regions, including Asia, he added.

“We see that some countries have higher numbers of coronaviruses, such as in India and Latin America, which raises concerns about growing demand,” Novak said.

After a gross OPEC + profit, the gross future traded 0.4% higher at nearly $ 66 a barrel in London.

Strong demand

It was the OPEC + Joint Monitoring Committee of Ministers that recommended maintaining the initially projected output growth. Jury ministers then asked other OPEC + members to cancel the full meeting scheduled for Wednesday, and instead wrote a statement on Tuesday in exchange for diplomatic messages.

Global oil inventories will reduce the average rate by 1.2 million barrels a day this year, OPEC + technical experts estimate on Monday. It’s a faster pace than the 800,000-a-day raffle they predicted a month ago. As a result, surplus stocks in developed countries will be reduced to 8 million barrels by the end of the quarter.

“You’re seeing tremendous demand,” Bernard Looney, CEO of BP Plc, said in a televised interview with Bloomberg on Tuesday. China’s oil demand is above the previous pandemic level, the US is almost back and “vaccinations will start in Europe”.

India’s virus infections, the world’s third-largest oil importer, are growing at a record pace. According to the OilX consultant, the country’s fuel demand on this day could break up to 350,000 barrels a day. But for now, the recovery in China and the US is outpacing a lower demand in India, said a senior OPEC + delegate, who asked not to be identified.

If the situation worsens, the coalition has the ability to move quickly, as it now meets approximately monthly, the delegate said. According to the document, the next OPEC + meeting is scheduled for June 1.

“The dark cloud is India,” said Helima Croft, RBC Capital Markets LLC’s chief commodity strategist. But “even if India’s demands worsen, they have a mechanism to act fairly quickly.”