OPEC on Friday offered a depressed oil market outlook for the remainder of the year due to the economic slowdown, while highlighting the challenges of 2020, while its rivals increase pumping, in a report that strengthened the case to maintain its pact of production cut
Photograph of a gas dispenser. Reference Image / Pexels
Reuters | Alex Lawler
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Leer en español: OPEP prevé panorama de mercado bajista para resto de 2019
In a monthly report, the Organization of Petroleum Exporting Countries lowered its forecast of oil demand growth by 40,000 barrels per day (BPD) this year and indicated that the market will have a slight surplus in 2020.
The bearish outlook is due to the slowdown of the economies amid the trade dispute between the United States and China and Brexit, and could pressure OPEC and a group of allies led by Russia to maintain their pumping cut policy to boost prices. A Saudi official hinted at taking more steps to support the market.
"Although the outlook for the fundamentals of the market seems somewhat bearish for the rest of the year, given the slowdown in economic growth, current global trade issues and the slowdown in the growth of demand for crude oil, it is still critical to closely monitor the balance supply / demand and help market stability in the coming months, "OPEC said in the report.
OPEC's policy of supporting prices through supply cuts has boosted shale production in the United States and other rivals, and the report suggests that the world will need less oil from the cartel in 2020.
OPEC's oil demand will average 29.41 million BPD next year, the group said, 1.3 million BPD less than this year. Nevertheless, the forecast for 2020 was high at 140,000 BPD compared to last month's report.