BAKU, Azerbaijan, Oct.9
By Leman Zeynalova – Trend:
Global oil demand in H2 2021 is expected to grow by 3.9 mb/d compared to 5.1 mb/d expected ending-Q2, largely due to the greater Delta variant-driven restrictions dampening Q3 demand growth in Asia, Trend reports with reference to Oxford Energy Studies Institute (OIES).
The expected rebound in Q4 however remains strong and only marginally lower than expectations ending-Q1 2021 (-0.125 mb/d), reads the OIES report.
“Global oil supply growth is lowered to 1.4 mb/d from 1.6 mb/d in 2021 and to 6.1 mb/d from 6.4 mb/d in 2022. Global supply continues to battle widespread outages and low investment, with the non-OPEC supply revival remaining muted in 2021. But supply growth is still expected to pick up in Q4 and well into H1 2022, as restrained production (both voluntary and involuntary) returns, before growth decelerates in H2. The market deficit in 2021 is estimated at -1.0 mb/d, followed by a 1.8 mb/d surplus in 2022. Risks around the outlook are skewed on the upside and are mainly confined on the supply side, expected to further narrow the projected surpluses in 2022,” says the report.
OIES analysts believe that new supply/demand risks build on the upside offsetting pandemic-driven demand risks and bottleneck pressures.
“On the supply-side, supply constraints both from OPEC+ and non-OPEC could limit supply growth in 2022 and push the annual price higher by $4.2/b. On the demand-side, potential near-term oil-switching in power generation, lift upside demand risks in 2022 to $4.3/b from $3.5/b last month.”
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