OPEC expects lower demand for its oil as US hits new milestone

Author: 
Reuters
ID: 
1579092180477675500
Wed, 2020-01-15 12:40

LONDON: OPEC expects lower demand for its crude oil in 2020 even
as global demand rises, it said on Wednesday, as rival producers
grab market share and the United States looks set for another
output record.

The United States, which has seen its output soar in recent
years powered by shale, will see total liquids output exceed a 20
million barrel per day (bpd) milestone for the first time, the
Organization of the Petroleum Exporting Countries forecast in its
market report.

US liquids output will reach 20.21 million bpd in the fourth
quarter of 2020 — almost meeting US demand of 21.34 million bpd,
OPEC said.

It lowered its 2020 demand forecast for OPEC crude by 0.1
million barrels per day to 29.5 million.

That would be around 1.2 million bpd lower than in the whole of
2019 and in line with December production, when OPEC’s share of
global output fell 0.1 percentage point month on month to 29.4
percent.

This year, it said OPEC’s market share is set to fall further
as output booms in non-OPEC rivals including the United States,
Brazil, Canada, Australia, Norway and Guyana while global demand is
rising.

OPEC said it had raised its overall 2020 oil demand growth
outlook by 0.14 million bpd to 1.22 million bpd from the previous
month, reflecting an improved economic outlook and booming demand
in India and China. If that growth materializes it would be 30%
stronger than in 2019.

It raised its forecast for non-OPEC oil supply growth in 2020 by
0.18 million bpd to 2.35 million bpd, up from 1.86 million bpd in
2019.

“The continued accommodative monetary policies, coupled with
an improvement in financial markets, could provide further support
to ongoing increases in non-OPEC supply,” OPEC said.

OPEC and some non-OPEC allies such as Russia have been curbing
production to prevent an oil glut and support oil prices above $60
per barrel. Their current deal expires in March.

“The collaboration between OPEC and non-OPEC producing
countries remains essential in maintaining stability in the oil
market,” OPEC said.

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Source: FS – All-News-Economy
OPEC expects lower demand for its oil as US hits new milestone