BAKU, Azerbaijan, July 9
By Leman Zeynalova – Trend:
Global oil supply is forecast to contract by 6.8 million barrels per day (b/d) in 2020, Chris Midgley, Head of Analytics, S&P Global Platts, told Trend.
“After dropping by 13 million b/d from April to June, global oil supply is now starting to recover with the return of shut in barrels and unwinding of Saudi Arabia’s over-compliance. Global oil supply is on track to increase by 5 million b/d through July and August, and another 3 million b/d by end-2020,” said the expert.
Midgley went on to add thatwith increasing concerns of new or second-wave COVID-19 cases in selected countries, S&P Global Platts has lowered its demand to 94 million b/d for 2020 – well below 2019.
“Oil balances have been tightening with demand improving from April lows, just as the supply response kicked in. But headwinds are plenty with weak refinery margins, an expected slowdown in Chinese crude buying, a strong supply recovery, growing anxiety on the development of COVID-19, on top of bloated global oil inventories,” said the analyst.
Midgley, noted that S&P Global Platts Analytics sees Dated Brent at $35-40/b in 3Q, waiting for onshore crude stocks to draw, but rising towards $50/b by end-2021.
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