OPEC: The development of the pandemic will determine the global economic recovery
The organization that leads and controls 40 % of the world crude oil market will maintain demand in the order of six million barrels per day
OPEC, in its monthly report on the oil market, pointed out that, despite the evolution of the Covid-19 pandemic, the global economic reactivation continues and “will not reduce the oil demand forecast for 2021 and 2022″.
However, in the report, the organization admits that the development of the pandemic will be “the determining factor in the pace of recovery, with the possible appearance of new variants or mutations as a risk.”
OPEC analysts are reserved when referring to the “impact of the delta variant of the coronavirus”, whose effect has been felt in the last 2 months due to its expansion in important economies, although the average price of a barrel of OPEC crude was located at $ 73.53 for July, its highest value since October 2018, something the group attributes to “the solid fundamentals of the market.”
Global recovery
The oil organization, which controls 40% of world crude production, forecast “world growth by 0.1% in both 2021 (5.6%) and 2022 (4.2%)”, keeping unchanged the demand established for those periods.
According to the data issued in the report, demand for 2021 remains similar to that established for last month, with an annual increase of around 6 million barrels per day (mbd), up to 96.6 mbd. While for 2022 the forecast demand registers a small growth of another 3.3 mbd to a total of 99.9 mbd, to reach the levels prior to the Covid-19 pandemic.
However, the United States is asking OPEC to increase production and offer crude to the market, in order not to risk the recovery of the world economy, because with current prices “there is a risk of damaging the global recovery.”
The national security adviser, Jake Sullivan, stressed that, “although OPEC and its allies had recently agreed to increases in production, this increase did not compensate for the previous cuts.”
Information broadcast by the CNBC news channel highlights that the White House “has transmitted to Saudi Arabia, the United Arab Emirates and other members of the alliance that message that their plans are simply not enough, given the critical moment in the global recovery.”
M. Rodríguez
Source: bancaynegocios
