BAKU, Azerbaijan, Feb.12
By Leman Zeynalova – Trend:
OPEC is expected to reduce crude oil production by 0.5 million b/d from March through May because of lower expected global oil demand in early 2020, the US Energy Information Administration (EIA) said in its February Short-term Energy Outlook (STEO), Trend reports.
This OPEC reduction is in addition to the cuts announced at the group’s December 2019 meeting.
EIA now forecasts OPEC crude oil production will average 28.9 million b/d in 2020, which is 0.3 million less than forecast in the January STEO.
In addition to these production cuts, EIA’s lower forecast OPEC production reflects ongoing crude oil production outages in Libya during the first quarter.
In general, EIA assumes that OPEC will limit production through all of 2020 and 2021 to target relatively balanced global oil markets.
Following an extraordinary meeting of the Joint Technical Committee (JTC) held in Vienna, from 4-6 Feburary 2020, the JTC has recommended extending voluntary production adjustments under the ‘Declaration of Cooperation’ process until the end of 2020 and to proceed with an additional adjustment until the end of the second quarter.
The JTC’s recommendations come in response to the fact that the coronavirus epidemic has had a negative impact on oil demand and oil markets.
The Committee also recommended a further adjustment in production until the end of the second quarter of 2020.
The outbreak in the Chinese city of Wuhan - which is an international transport hub - began at a fish market in late December 2019. Since then over 1,000 people have died and over 45,000 people have been confirmed as infected.
Some sources claim the coronavirus (or COVID-19) outbreak started as early as November 2019.
Aside from Mainland China, the cases of coronavirus spreading have also been confirmed in Japan, Singapore, Thailand, South Korea, Hong Kong, Australia, Germany, the US, Malaysia, Taiwan, Vietnam, Macau, France, Canada, the UAE, India, Italy, Russia, Philippines, the UK, Nepal, Cambodia, Belgium, Spain, Finland, Sweden and Sri Lanka.
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