The disconnect between its demand forecast and its supply call raises questions on whether OPEC+ is intentionally firing up prices or if some of the demand expectations are overstated.
That’s according to Rystad Energy’s Oil Markets Analyst Louise Dickson, who made the comment in a statement sent to Rigzone on Thursday. In the statement, Dickson outlined that Rystad Energy does not see aviation demand recovering in the same way that the international producer group does.
“OPEC’s research arm itself sees oil demand increasing towards 97.9 million barrels per day in the third quarter of 2021, yet the policy making group of OPEC+ has not yet taken supply action to meet this expectation,” Dickson said in the statement.
“The market consensus is now focused on the worry that oil demand will outpace supply in the second half of 2021. Certainly, the seasonal summer demand surge is coming, and if OPEC+ doesn’t rise to the occasion and bring more supply on the market, oil prices will continue gains in coming months,” Dickson added.
Dickson warned in the statement that oil above $70 per barrel will be a real burden for oil importing countries, as higher oil prices could stunt economic recovery prospects.
“A distinct economic lag in emerging economies after the pandemic could ultimately negatively impact the global overall demand for commodities needed to restart and jumpstart economies and pose a downside risk to the spectacular oil price gains of the past seven months,” Dickson said.
“According to our country-level oil demand models, there are still some countries and regions that will not see oil demand levels recover to pre-pandemic levels until 2022, and some are delayed even further out on the timeline,” the Rystad Energy representative added.
On June 1, OPEC+ reconfirmed its existing commitment to gradually return two million barrels per day to the market. The next OPEC and non-OPEC ministerial meeting is scheduled for July 1.
At the time of writing, the Brent crude oil price stood at $71.68 per barrel.
To contact the author, email andreas.exarheas@rigzone.com
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