OPEC cuts demand forecast for 2021 but says soaring gas prices could help

A 3D printed oil pump cylinder is seen in front of an OPEC logo displayed in this illustration photo, April 14, 2020. REUTERS / Dado Ruvic

LONDON, Oct. 13 (Reuters) – OPEC downgraded its forecast for global oil demand growth for 2021 while maintaining its vision for 2022, its monthly report said on Wednesday, but said the surge natural gas prices could stimulate demand for petroleum products as end users change.

The Organization of the Petroleum Exporting Countries (OPEC) now expects demand for oil to increase by 5.82 million barrels per day (bpd), up from 5.96 million bpd in its previous forecast, saying that the downward revision was mainly due to data for the first three quarters of the year.

He maintained a growth forecast of 4.2 million bpd for next year.

The group of oil-producing countries, however, said natural gas prices at record highs could boost oil demand growth as industrial users turn to petroleum products instead.

“If this trend continues, fuels such as fuel oil, diesel and naphtha could benefit from support, driven by higher demand for power generation, refining and petrochemical use,” said OPEC.

European gas at TTF’s Dutch hub on Wednesday stood at a crude oil equivalent of around $ 177 a barrel, based on the relative value of the same amount of energy from each source, calculations of Reuters based on Eikon data – above Brent record. crude price of $ 147 in 2008.

Brent crude prices were around $ 83 a barrel at 3:00 p.m. GMT.

During an industry event on Tuesday, Russian President Vladimir Putin said oil prices could reach $ 100 a barrel, but added that OPEC + was doing everything possible to stabilize the world market. Read more

Saudi Aramco CEO Amin Nasser estimated last week that demand for the switch from gas to oil increased at around 500,000 bpd. Read more

OPEC +, an alliance between OPEC and other Russian-led producers, agreed this month to stick to its plan to increase production by 400,000 bpd for November then that it is gradually reversing the production cuts it has made to support previously low prices.

In its report, OPEC raised its 2021 forecast for OPEC crude oil demand from 100,000 b / d to 27.8 million b / d and an additional 100,000 b / d for 2022 to 28. , 8 million bpd.

He said OPEC production in September increased by around 490,000 bpd to 27.33 million bpd, according to secondary sources.

In a sign of a tightening oil market, OPEC said OECD commercial oil inventories fell 19.5 million barrels in August from the previous month to 2.85 trillion barrels, according to the reports. preliminary data.

That figure is 183 million barrels lower than the last five-year average and 131 million barrels lower than the 2015-2019 average, OPEC said.

Reporting by Ahmad Ghaddar and Alex Lawler Editing by Jason Neely, Louise Heavens and David Goodman

Our Standards: Thomson Reuters Trust Principles.

Previous U.S. to lift Canada-Mexico land border restrictions for vaccinated visitors in November