English>

MarketNews

OPEC downgrades forecast for oil demand growth in 2019 and 2020 - CNBC

SEPTEMBER 11, 2019

Key Points

  • In a closely-watched monthly report, OPEC cut its forecast for global oil demand growth for the remainder of this year to 1.02 million barrels per day (b/d).
  • That’s down 80,000 b/d from its August estimate.
  • OPEC attributed the downgrade to weaker-than-expected economic data in the first-half of the year and deteriorating growth projections for the remainder of 2019.


OPEC logo is seen at the Organisation of Petroleum Exporting...VIENNA, AUSTRIA - 2018/06/20: OPEC logo is seen at the Organisation of Petroleum Exporting Countries (OPEC) building in Vienna. The 174th OPEC meeting will be held on the 22th June 2018 in Vienna. (Photo by Omar Marques/SOPA Images/LightRocket via Getty Images) SOPA Images | LightRocket | Getty Images

OPEC downwardly revised its forecast for oil demand growth on Wednesday, building the case for another round of production cuts from the Middle East-dominated group of producers.

In a closely-watched monthly report, OPEC cut its forecast for global oil demand growth for the remainder of this year to 1.02 million barrels per day (b/d). That’s down 80,000 b/d from its August estimate.

The group, which consists of some of the world’s most powerful oil-producing nations, attributed the downgrade to weaker-than-expected economic data in the first-half of the year and deteriorating growth projections for the remainder of 2019.

In 2020, OPEC said it sees world oil demand increasing by 1.08 million b/d. This represents a downward adjustment of 60,000 b/d from the previous month’s assessment, “mainly to accommodate changes to the world economic outlook.”

The report comes as OPEC and allied non-OPEC partners, sometimes referred to as OPEC+, prepare to meet in Abu Dhabi on Thursday.

The meeting is likely to provide crucial clues about how far some of OPEC’s most powerful players are willing to go to get prices on a firmer footing.

Production cuts

International benchmark Brent crude traded at around $63.09 a barrel Wednesday morning, up around 1.1%, while U.S. West Texas Intermediate (WTI) stood at $58.15, more than 1.2% higher.

The full coalition will gather again in Vienna at the end of the year to decide whether any further action is required for 2020.


What’s next for oil?

OPEC+ is expected to reaffirm its commitment to rebalancing the market at its September 12 meeting, with OPEC kingpin Saudi Arabia poised to double down on its “whatever it takes” message.

Alongside Russia and other allied producers, OPEC agreed to reduce output by 1.2 million barrels a day at the beginning of 2019. That deal replaced a previous round of production cuts that began in January 2017.

SEE HOW MUCH YOU GET IF YOU SELL

NGN
This website uses cookies We use cookies to personalise content and ads, to provide social media features and to analyse our traffic. We also share information about your use of our site with our social media, advertising and analytics partners who may combine it with other information that you've provided to them or that they've collected from your use of their services
Real Time Analytics