By Leman Zeynalova – Trend:
BAKU, Azerbaijan, Aug.13
Compensation for earlier OPEC+ over-production could keep world supply steady in August, the International Energy Agency (IEA) said, Trend reports.
“In July, Saudi Arabia withdrew its voluntary 1 mb/d cut and changes in production elsewhere saw OPEC+ output increase by a net 1.3 mb/d. In August, output could rise again as the 9.6 mb/d of cuts implemented in May ease to 7.7 mb/d. However, if countries that have not hitherto complied with their quotas cut back by enough to bring them into compliance, global oil supply would not necessarily increase significantly. Our balances show that in June demand exceeded supply, and for the rest of the year there is an implied stock draw. However, ongoing uncertainty around demand caused by Covid-19 and the possibility of higher output means that the oil market’s re-balancing remains delicate,” IEA said in its Oil Market Report.
The report shows that global oil supply rose by 2.5 mb/d to 90 mb/d in July after Saudi Arabia ended its voluntary 1 mb/d cut, the UAE exceeded its OPEC+ target and US production started to recover.
“While OPEC+ cuts ease by nearly 2 mb/d this month and other producers restore shut-in volume, compensation for earlier OPEC+ over-production could keep world supply steady in August. Global supply looks set to fall by 7.1 mb/d in 2020 and rise by 1.6 mb/d next year.”
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