DUBAI: OPEC+ has lowered its 2021 oil demand growth forecast by 300,000 barrels per day reflecting concerns about the market’s recovery as new coronavirus lockdowns take hold, a report from its experts panel meeting seen by Reuters showed.
The Joint Technical Committee, which advises the group of oil-producing nations that includes Saudi Arabia and Russia, met on Tuesday ahead of a ministerial meeting on Thursday to decide output policy.
“Despite the ongoing destocking of commercial OECD stocks, they remain above the 2015-2019 average, while recognizing that prevailing volatility in the market structure is a signal of fragile market conditions,” the panel said in the report.
Under its base case scenario, it expects oil demand to grow by 5.6 million barrels per day this year, down by 300,000 bpd from its previous forecast.
It also raised its global supply growth forecast by 200,000 bpd to 1.6 million bpd.
As a result, it sees oil stocks in the industrialized world dipping below the 2015-2019 average in August, a month later than it previously forecast.
The Organization of the Petroleum Exporting Countries and allied producers, a group known as OPEC+, are curbing output by just over 7 million bpd to support prices and reduce oversupply. Saudi Arabia has added an additional one million bpd to those cuts.