Baku, Azerbaijan, March 6
By Aygun Badalova - Trend:
US JP Morgan bank lowered its global oil supply estimates by 0.4 million barrels per day (bpd) to 96.4 million bpd, with the drop in non-OPEC supply only partially offset by higher OPEC estimates.
In 2017, analysts of the bank forecast further global oil supply contraction of 0.5 million bpd amounting to 95.9 million bpd.
"Lower US, Canadian and European supply estimates are incorporated based on our view that low prices are starting to have an increased impact on the financial ability of producers to sustain production," JP Morgan's analysts said in a report obtained by Trend.
Non-OPEC oil supply is expected by the analysts to decline by 0.9 million bpd to 54.7 million bpd in 2016 and by 1 million bpd to 53.7 million bpd in 2017.
"Low prices have certainly started to feed through into lower non-OPEC supply growth, albeit not yet sufficiently to rebalance markets, analysts said. However, the process appears to be underway and building momentum. Consequently, it still seems premature for Saudi Arabia and others to look to support prices at this juncture."
JP Morgan forecasts OPEC oil production at 32.2 million bpd both in 2016 and 2017 compared to 31.5 million bpd in 2015.
Cartel's 13 members produced 32.335 million bpd in January, about 130,700 bpd more than December 2015, according to OPEC's latest report. The official quota for OPEC oil production stands at 30 million bpd.