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By Vladimir Soldatkin, Rania El Gamal and Ahmad Ghaddar
MOSCOW / DUBAI / LONDON (Reuters) – Some OPEC Group members of oil-producing countries are expected to reduce production by an additional 2.31 million barrels, consistent with the day (bpd) to offset their recent oversupply, an internal OPEC report. noticed through Reuters programs.
The surplus between May and July is expected to be offset in August and September, according to the report.
OPEC, which includes members of the Organization of Petroleum Exporting Countries and manufacturers who add to Russia, intensified its joint production cuts to a record 9.7 million bpd in May before cutting them to 7.7 million bpd this month.
In April, the effect of the new coronavirus on air and road travel and other areas of the world economy brought the costs of the leading oil below $16 in line with the barrel.
The continuation of the virus now threatens forecasts of a resumption of oil demand.
AUGUST SEPTEMBER
The internal report noted through Reuters did not specify how the additional discounts would be distributed during August and September. But if the figure of 2.31 million b/d is followed and distributed slightly over the two months, this would bring OPEC oil cuts to about 8.85 million b/d.
The report that OPEC expects oil demand in 2020 to decline to 9.1 million b/d, 100,000 b/d more than in its previous forecast, before expanding to 7 million b/d in 2021.
However, OPEC also sees a situation of choice in which a momentary wave of more powerful and prolonged infections hits Europe, the United States, India and China in the part of the year.
Under this scenario, demand is expected to fall to 11.2 million b/d in 2020, bringing OECD oil inventories in the fourth quarter to 233 million barrels above the average of the past five years, according to the report.
Inventories would be 250 million barrels over the past five years in 2021.
Accordance
Knowledge shows that among OPEC members, Iraq and Nigeria were the least fulfilled and even the United Arab Emirates, which made the most voluntary cuts in June, overproduction of around 50,000 b/d during the May-July period.
Among non-OPEC participants, Russia and Kazakhstan overproduced 280,000 b/dy 190,000 b/d respectively.
(Chart: OPEC – OPEC overproduction from May to July – May to July https://graphics.reuters.com/OIL-OPEC/rlgpdowoovo/index.html)
(Editing via Jason Neely)