The Strategist

OPEC cuts oil demand growth estimate by 0.3m bpd

04/01/2021 - 04:02

The forecast for global oil demand growth in 2021 has been lowered from 5.9 million bpd to 5.6 million bpd, OPEC Secretary General Mohammed Barkindo said at a meeting of the OPEC+ ministerial monitoring committee.

"The forecast for global oil demand in 2021 is slightly revised upwards to 5.6 million bpd, and we must not forget that demand has declined strongly in 2020 by 9.6 million bpd," Mr Barkindo said in an OPEC press release.

"Estimates for the first half of the year have again been adjusted downwards, mainly due to continued quarantines and new restrictions in many key parts of Europe. In contrast, the outlook for oil demand remained relatively stable in the second half of the year, reflecting expectations of a stronger economic recovery and the positive impact of vaccination rollout," he said.

A meeting on the parameters of the OPEC+ deal in May has ended, with a final decision expected at the ministerial meeting on Thursday, 1 April, Reuters reported citing sources in the alliance's delegations. The agency's sources did not specify whether a committee had made a recommendation on the deal. One of the sources said that the committee meeting appeared to have ended without results.

Recall that at the last meeting the ministers agreed that all parties to the agreement, except Russia and Kazakhstan, would maintain production levels in April. Russia was allowed to restore it by 130,000 bpd, Kazakhstan - by 20,000 bpd. Similar exceptions were made for these countries in January, when oil production parameters for February and March were discussed.