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Against the backdrop of renewed growth in the number of COVID-19 cases in Europe and the US, the International Energy Agency (IEA) in its November report further lowered its forecast for oil demand for 2020. The agency now expects the figure to drop by 8.8 million barrels per day (bpd) at year-end to 91.3 million bpd instead of 8.4 million bpd. In contrast, the agency estimates that demand will increase by 5.8 million bpd in 2021 to 97.1 million bpd (instead of 5.5 million bpd), but this figure will also be 3 million bpd lower than at the end of 2019.
The estimate was adjusted by 0.4 million bpd for the third quarter of 2020, 1.2 million bpd for the fourth quarter and 0.7 million bpd for the first quarter of 2021 (developed countries will account for most of the decline, while the Chinese and Indian demand estimates were improved). "The emergence and spread of the vaccine could provide significant support to demand no sooner than mid next year," noted the IEA (news of successful vaccine trials in the US has led to marked increases in quotations and oil prices).
At the same time, the participants in the OPEC+ transaction fulfilled its terms by 103% (the same as a month earlier), including Russia - by 95% (9.08 million bpd was produced against 9.11 million bpd in September), and Saudi Arabia - by 101% (8.98 million bpd - production did not change during the month). On average, over the term of the agreement, this figure was 96% for all participants. It should be noted that the agreement is valid from May 1 and implied a decrease in production by 9.7 million bpd in May-June, by 7.7 million in the second half of the year and 5.8 million bpd until the end of April 2022.
In turn, non-OPEC+ countries reduced production by 170,000 bpd in October to 47 million bpd (in the US minus 350,000 bpd in October to 10.6 million bpd, down 2.1 million bpd by October last year). For the year as a whole, supplies are expected to drop by 1.3 million bps in 2020 and grow by 0.2 million bpd next year. In the U.S., supplies may decline by 600,000 bps at year-end, but will increase by 655,000 bps next year.
source: iea.org
The estimate was adjusted by 0.4 million bpd for the third quarter of 2020, 1.2 million bpd for the fourth quarter and 0.7 million bpd for the first quarter of 2021 (developed countries will account for most of the decline, while the Chinese and Indian demand estimates were improved). "The emergence and spread of the vaccine could provide significant support to demand no sooner than mid next year," noted the IEA (news of successful vaccine trials in the US has led to marked increases in quotations and oil prices).
At the same time, the participants in the OPEC+ transaction fulfilled its terms by 103% (the same as a month earlier), including Russia - by 95% (9.08 million bpd was produced against 9.11 million bpd in September), and Saudi Arabia - by 101% (8.98 million bpd - production did not change during the month). On average, over the term of the agreement, this figure was 96% for all participants. It should be noted that the agreement is valid from May 1 and implied a decrease in production by 9.7 million bpd in May-June, by 7.7 million in the second half of the year and 5.8 million bpd until the end of April 2022.
In turn, non-OPEC+ countries reduced production by 170,000 bpd in October to 47 million bpd (in the US minus 350,000 bpd in October to 10.6 million bpd, down 2.1 million bpd by October last year). For the year as a whole, supplies are expected to drop by 1.3 million bps in 2020 and grow by 0.2 million bpd next year. In the U.S., supplies may decline by 600,000 bps at year-end, but will increase by 655,000 bps next year.
source: iea.org
