OPEC cuts 2019 oil demand forecast on global slowdown

OPEC cuts 2019 oil demand forecast on global slowdown

Looking forward, oil could continue to rise, courtesy of falling OPEC and Venezuelan supplies.

"The production losses to start 2019 are already larger than we expected", Goldman says, noting that more disruptions could be coming, due to the USA sanctions on Venezuela's oil industry.

The IEA raised its estimate of growth in crude supply from outside the Organization of the Petroleum Exporting Countries to 1.8 million bpd in 2019, from 1.6 million bpd previously.

U.S. crude output is expected to grow by 1.45 million bpd this year and by another 790,000 bpd next year to hit 13 million bpd in 2020, according to the Energy Information Administration.

The IEA said that compliance with the so-called Vienna Agreement was 86 percent by OPEC states, with Saudi Arabia, UAE and Kuwait cutting by more than promised.

OPEC is partnering with 10 non-member nations, including Russian Federation, to keep 1.2 million bpd off the market. Russian Federation had also agreed to cut 230,000 barrels a day in production over the same period, but now is just down 90,000 barrels a day.

Also pressuring oil prices were sanctions that U.S. President Donald Trump implemented on Venezuela's oil exports in recent weeks, which has reduced supply from the global market. "With economic momentum expected to slow in the current year ... this makes economic developments in the major consuming nations a key factor to monitor going forward".

He added that markets were amply supplied due to "adequate global oil inventories, the prospect of weakened demand tied both to US-China trade and broader economic concerns, the approach of seasonal refinery maintenance - when crude oil demand declines - and an influx of new supply from the United States and elsewhere".

The cartel has joined forces with 10 non-member nations including Russian Federation to trim output to avoid a repeat of the 2014 crash when prices dove to below $30 a barrel - down from over $100 - due to a glut in supplies and weakening global demand.

As of writing, Brent is trading at $63.06 per barrel, representing a 1 percent gain on the day.

"Energy commodity prices were mixed in January".

The country's average heavy crude price was also reported to be $56.29 since beginning of 2019 up to the report's publishing day.

At the same time, major countries within OPEC are eyeing worldwide expansion for the first time. Prices climbed as much as 3 percent in London on Tuesday after OPEC data showed it made a strong start to the reductions and Saudi Energy Minister Khalid Al-Falih told the Financial Times the kingdom would cut even deeper.

The company has built a substantial worldwide "downstream" presence in refining, with...

"In quantity terms, in 2019 the USA alone will grow its crude oil production by more than Venezuela's current output", the IEA said. OPEC and other countries will either have to continue curbing extraction to maintain prices in the future or accept an energy independent US and the likely oversupply of energy that would bring to the market.

Related Articles

  • Hours-old baby girl abandoned with her umbilical cord still attached

    Hours-old baby girl abandoned with her umbilical cord still attached

    The woman invited Fuentes and the baby into her heated auto , where the two chose to unzip its soiled flannel onesie. The newspaper carrier discovered the baby a short time later and brought her into a vehicle to keep her warm.
    Activision Blizzard reports historic earnings amid big layoffs

    Activision Blizzard reports historic earnings amid big layoffs

    Blizzard CFO Amrita Ahuja exited last January, while Activision consumer products division boss, Tim Kilpin, retired this month. A high P/E suggests that investors are expecting higher earnings growth in the future compared to companies with a lower P/E.
    Anti-Trump Protesters March in El Paso Streets During Trump Rally

    Anti-Trump Protesters March in El Paso Streets During Trump Rally

    He appeared impressed Monday night while describing the drug-detecting abilities of German shepherds that work for the U.S. They repeatedly said they were unwilling to negotiate on border security until the president reopened the government.
  • Trump supporter attacks BBC cameraman at rally

    Trump supporter attacks BBC cameraman at rally

    According to the magazine, the El Paso police department is was "still gathering" information regarding the incident. He said the man nearly knocked him over twice before the assailant was wrestled away by another member of the media.
    Ricky Rebel Wears Pro-Trump Jacket at 2019 GRAMMYs

    Ricky Rebel Wears Pro-Trump Jacket at 2019 GRAMMYs

    She and Trump want to "secure" the southern border (and not the northern border ) because of who it will keep out. In fact, two years ago, Joy arrived at the Grammy Awards 2017, wearing a red, white, and blue MAGA dress.
    'Aladdin' Grammys Trailer Teases First Look at Will Smith's Blue Genie

    'Aladdin' Grammys Trailer Teases First Look at Will Smith's Blue Genie

    The trailer for Aladdin aired last night during the Grammys and it seems to have lost the momentum it once had. Holy crap, that is the stuff nightmares! Aladdin opens on May 23 in Australia and May 24 in the USA and UK.
  • Weekend: May rejects pivot towards Brexit customs union compromise

    Weekend: May rejects pivot towards Brexit customs union compromise

    Brexit Secretary Stephen Barclay will be in Brussels later today to meet the EU's Chief Brexit negotiator Michel Barnier . Seven of Britain's top 10 export markets are in the European Union , with Germany second behind the United States.
    Kyler Murray Has Officially Made A Decision On The NFL

    Kyler Murray Has Officially Made A Decision On The NFL

    He will reportedly repay $1.29m (£1m) of the $1.5m (£1.17m) he received a year ago and forfeit the remaining $3.16m (£2.46m). He already received $1.5 million of his signing bonus and was to receive an additional $3.16 million on March 1.
    Wales equal rugby record

    Wales equal rugby record

    The second try came from a delicate chip by replacement flyhalf Gareth Anscombe for Watkin to pounce on. He also gave credit to Italy , who he said made it hard for his team to find their rhythm in attack.
  • Saudi prince likely to sign $10bn MoUs during upcoming visit

    Saudi prince likely to sign $10bn MoUs during upcoming visit

    Sources further said $20 billion investment will come in Pakistan following the visit of Saudi Crown Prince Mohammad Bin Salman . During visit of the Saudi Crown Prince, both sides are ready to sign four memorandums of understanding (MoUs) worth $15 billion.
    Retired astronaut Mark Kelly, husband of Gabby Giffords, to run for Senate

    Retired astronaut Mark Kelly, husband of Gabby Giffords, to run for Senate

    Kelly, a former naval aviator, was selected as an astronaut by NASA in 1996, in the same class as his twin brother Scott. In an interview with Arizona's Morning News , political consultant Alex Castellanos pointed to Kelly's history as a U.S.
    Tottenham's Pochettino critical of referee Oliver for 'unbelievable' Son booking

    Tottenham's Pochettino critical of referee Oliver for 'unbelievable' Son booking

    But Vardy partly made amends in the 76th when he turned in Pereira's cross from close range. Lloris, Trippier, Sanchez, Vertonghen, Rose, Winks, Sissoko, Skipp, Eriksen, Son, Llorente.