Baku, Azerbaijan, Feb.5
By Leman Zeynalova – Trend:
Non-OPEC oil supply is expected to grow by 1.96 million barrels per day in 2018, according to the US JP Morgan bank.
“We have revised up our growth estimates for 2018 by 426,000 barrels per day compared to our last estimates on the back of the upward revision to our oil price scenario mostly to US shale,” said the report obtained by Trend.
JP Morgan analysts believe US shale will remain the highlight of the global supply story in 2018, driven by higher oil prices.
“US shale will remain the highlight of global supply story in 2018 as higher oil prices and higher productivity would only mean one thing, a surge in US crude supply. But that should broadly be seen as a story for second half of 2018,” said the report.
However, JP Morgan analysts expect the non-OPEC production growth is likely to slow down in 2020 unless US supply continue to increase significantly and diverge from the capex cycle vs production trends.
“If that is the case for next two years, then we think oil prices will continue to remain in a narrow window as they will be capped by US shale supply which could exacerbate the supply demand imbalance,” said the report.
Total liquids supply rose by 630,000 barrels per day in 2017 and is expected to rise by 2.1 million barrels per day in 2018.
“Within the total global supply, the main driver is non-OPEC supply which we now expect to grow by 1.96 million barrels per day in 2018,” said JP Morgan bank.
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