Oil Forum (Photo: Tania Rego / Agnia Brasil)
The Organization of the Petroleum Exporting Countries (OPEC) maintained its forecast of a strong recovery in global oil demand in 2021, which should be led by the United States and China, though it cited uncertainties caused by the pandemic.
In a monthly report on Thursday, OPEC said demand is expected to grow by 5.95 million barrels per day (bpd), or 6.6%, this year. Estimates held steady for the second month in a row.
The group’s estimates were maintained after a slower-than-expected rebound in the first half and with OPEC warning of “significant uncertainties” related to the coronavirus, such as the possible emergence of new variants.
“Global economic recovery has been delayed by a resurgence of Covid-19 infections and new ‘lockdowns’ in major economies including the eurozone, Japan and India,” OPEC said in the monthly report.
“In general, the resumption of global economic growth, and with it oil demand, should strengthen in the second half,” he said.
OPEC has forecast global economic growth of 5.5% in 2021, a similar projection to the previous year, assuming the impact of the pandemic will generally be contained by the start of the second half.
Brent crude oil prices, an international benchmark, were trading above $72 a barrel at the time of the report’s release. They are up 29% this year amid rising demand and production cuts from OPEC and its allies, known as the OPEC+ group.
The report also showed an increase in OPEC supplies, reflecting the group’s decision to increase production, and growth in Iran, which is exempt from voluntary cuts due to US sanctions. OPEC said production rose by 390,000 barrels per day to 25.46 million bpd in May.
