By Ernest Omoarelojie, with agency reports
The Organisation of Petroleum Exporting Countries, OPEC, has raised the hope for crude oil producing countries that the demand for the product will gain more momentum in the second half of the year beginning from Thursday.
Secretary-General, Nigeria’s Mohammad Barkindo, disclosed this via video conference at the 31st Meeting of the Joint Ministerial Monitoring Committee. The rise, according to him, will see demand grow by some six million barrels per day to reach a cumulative 96.6 million barrels per day.
“Oil demand is forecast to grow by six million barrels per day to around 96.6mb/d on average for the year. Similar to the economy, growth in the second half of the year is expected to gain momentum, potentially surpassing 99mb/d in the fourth quarter.”
Barkindo added that the forecast by the Organisation is on the assumption that production by non-OPEC supply would grow by an estimated 0.8 million barrels per day in 2021 for the year’s average of 63.7 million barrels per day.
” We appear to be well on the road to recovery, with oil demand growth expected to accelerate in the second half of the year, however, let us be aware that there are still uncertainties that could entail risks for market stability.
Firstly, we are not completely out of the danger zone with the pandemic. We have seen in recent days an uptick in the spread of the so-called Delta Variant, which is highly infectious and could prey upon those sectors of the population who have not yet been vaccinated.”
But Barkindo warned of a not-so-rosy atmosphere for 2022 as he called on OPEC members and non-members alike to begin planning for the year ahead.
According to him, OPEC’s early numbers for 2022 shows a significant imbalance between supply and demand beginning from the second quarter onwards. In particular, he pointed out that forecast indicates a supply that would exceed demand by 5.4 million barrel per day, adding that in the third quarter, it would go down by 3.6 million barrels per day and subsequently 2.3 million barrels per day in the fourth quarter.
“Given all of the painful lessons and sacrifices over the last 16 months, this is a scenario that none of us would like to see materialise,” Barkindo stated.