IEA says oil demand recovery has exceeded supply growth

According to a report from EnergyWorld.

In its monthly report, the IEA quoted OPEC+ member countries to increase oil supply as saying that the expected supply growth for the rest of this year is far less than our forecast for a substantial increase in demand after the second quarter.

According to the IEA, the Organization of Petroleum Exporting Countries (OPEC) and its allies, including Russia, are called OPEC+ organizations, and their daily oil production in the second quarter was about 150,000 barrels per day lower than demand.

The Paris-based regulator said it expects this gap to widen to 2.

Since 2017, OPEC+ oil-producing countries have been restricting production, but since the implementation of record production cuts last year, production has been relaxed.

The IEA said that the widening gap between supply and demand has paved the way for OPEC+ to further ease production cuts or reduce inventories more drastically.

The recovery of supplies outside of OPEC+ has been slower than expected by the IEA, as the new crown epidemic has delayed projects in Brazil and the Gulf of Mexico and hindered maintenance in Canada.

Hao Fen Translated from Energy World Network

The original text is as follows:

　　IEA sees oil demand recovery outpacing growth in supply

　　Oil demand is already outstripping supply and the shortfall is expected to widen as vaccinations against COVID-19 bolster the global economy, the International Energy Agency (IEA) said on Wednesday.

　　"The anticipated supply growth through the rest of this year comes nowhere close to matching our forecast for significantly stronger demand beyond the second quarter," the IEA said in its monthly report, citing increased pumping from OPEC+ countries.

　　Output from the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, the so-called OPEC+ group of producers, lagged demand by around by 150,000 barrels per day (bpd) in the second quarter, IEA said.

　　That shortfall is expected to widen to a 2.

　　OPEC+ producers have been curbing output since 2017 but have eased since imposing record high cuts last year, with more easing agreed from this month.

　　"The widening supply and demand gap paves the way for a further easing of OPEC+ supply cuts or even sharper stock draws," the IEA said, noting that storage of oil had ebbed to nearly the five-year-average after soaring amid the pandemic.

　　Getting inventories back down to the five-year average was, along with supporting prices, one of the aims of the OPEC+ cuts to begin with.

　　Supply recovery outside OPEC+ was recovering more slowly than the IEA expected as the virus delayed projects in Brazil and the Gulf of Mexico and hampered maintenance in Canada.

　　While new waves of infections in Brazil and Thailand and even India-the world's third-largest consumer suffering record-breaking cases-were not enough to derail the trend but could continue to affect the market, it added.

　　"India's COVID crisis is a reminder that the outlook for oil demand is mired in uncertainty.
Until the pandemic is brought under control, market volatility is likely to persist.
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