(THIS ARTICLE IS COURTESY OF THE SAUDI NEWS AGENCY ASHARQ AL-AWSAT)
OPEC Warns of Oil Surplus in 2019
For 2019, demand will likely grow by 1.29 million barrels per day to 100.08 million bpd — some 70,000 million barrels per day less than in the September report. Meanwhile, the cartel now sees the output from non-member nations increasing by 2.23 million bpd next year, up 120,000 bpd from its last forecast.
“Although the oil market has reached a balance now, the forecasts for 2019 for non-OPEC supply growth indicate higher volumes outpacing the expansion in world oil demand, leading to widening excess supply in the market,” the group wrote.
“The market now increasingly looks concerned about the prospects of too much supply,” said Norbert Ruecker, head of commodity research at Swiss bank Julius Baer.
“Hedge funds and other speculative money have swiftly changed from the long to the short side,” he added.
Saudi Minister of Energy, Industry and Mineral Resources Khalid al-Faleh said Monday that OPEC and its allies have agreed that technical analysis of the energy market shows a need to cut oil supply from 1 million barrels per day (bpd) from October levels.
“Hopefully, Saudi Arabia and OPEC will not be cutting oil production. Oil prices should be much lower based on supply!” US President Donald Trump wrote on Twitter.
Nigeria Increases Output
Nigeria will raise its crude oil production to 1.8 million bpd in 2019 from around 1.6 million bpd currently, head of the Nigerian National Petroleum Corporation (NNPC) Dr. Maikanti Baru told Reuters on Tuesday.
Baru added that the country currently produces 1.6 million bpd of oil and 0.4 million bpd of condensate.
“The expected deals are to be signed this month. We are almost done,” he stated. The NNPC boss hinted that the corporation could also sign crude-for-product agreements with Shell and ExxonMobil.