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Demand for OPEC output expected to decline in 2020

Demand for OPEC output expected to decline in 2020

Mubasher: The Organization of the Petroleum Exporting Countries (OPEC) on Thursday projected that world demand for its crude would fall next year, indicating a return to oversupply, despite a pact to trim supplies.

Global oil consumption is now projected to average 29.3 million barrels per day (bpd), down by 1.3 million bpd from this year, OPEC’s research arm said in its monthly oil market report (OMR).

In addition, the producer club cut its production forecast for its peers, including Russia, expecting a smaller growth of 2.05 million bpd this year.

Non-OPEC oil supply is set to increase by 2.4 million bpd next year, higher than in the current year, “mainly due to the debottlenecking of oil infrastructure in North America and new project ramp ups in Brazil, Norway and Australia,” the report said.

“US tight crude production is anticipated to continue to grow as new pipelines will allow more Permian crude to flow to the US Gulf Coast export hub,” OPEC said.

By 2:54 pm GMT, US Nymex crude futures inched up by 0.07% to $60.47 per barrel (pb), while global benchmark Brent futures declined by 0.16% to $66.90 pb.