OPEC+ s 9mn b/d of spare capacity stands ready to ramp…
In the wake of the 2Q20 oil demand collapse, OPEC+ struck an unprecedented deal to remove nearly 10mn b/d of supply from the market. Now, with Brent trading into the $60-65 range, we expect OPEC+ to counter, adding more than 1.3mn b/d of supply in 2Qe and ramping further into year-end to keep prices and balances in check. Over the medium term, we think OPEC+ coordination will likely continue as the group wields its spare capacity in an effort to manage prices. GCC countries will likely have to carry meaningful spare capacity as demand growth slows and modest non-OPEC+ increases fill the gap.
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Oil demand to reach pre-Covid levels by 2023: BofA
DUBAI, December 23, 2020 While the oil industry is moving in the right direction with a number of refinery closures announced since October, more closures are likely needed, as the global oil demand to reach pre-Covid-19 levels by 2023, said the Bank of America (BofA) in a new report. Refinery closures span the US, Northwest Europe, and the Asia Pacific region and totalling nearly 1 million barrels per day (b/d) of capacity, according to the latest Global Energy Weekly from BofA Securities. Meanwhile, a handful of struggling refineries, especially in the Asia Pacific region, have undertaken reviews to determine whether closing or repurposing are better options than continuing refinery operations.