Coronavirus Makes for an Oily Situation
As coronavirus cases peak once again in Europe and the United States, the anticipated continued weakened demand for oil could see global energy producers able to tweak an agreement on production cuts till 202 — as per an announcement on Monday by Saudi Arabia’s energy minister.
The Covid-19 pandemic — as with most industries worldwide, has also seen the dampening of the price of oi which has affected the key revenue for several oil-producing nations.
Mohammad Barkindo, the OPEC Secretary-General, outlined the current industry situation, “Yes we have seen, or we are seeing a contraction of nearly 9.8 million barrels a day for 2020, but 2021 forecasts are continuously being revised upwards of 6.5 million barrels a day at the moment. And you have seen the reaction of the market after the U.S. elections, so there is no cause for alarm.”
The OPEC+ agreement aimed to ease those cuts to 7.7 million barrels per day through the end of the year and to almost 6 million barrels a day for 16 months beginning in January 2021.
And Post-Covid-19 Pandemic?
Sultan al-Jaber, the CEO of Abu Dhabi National Oil Company, remains positive about the post-covid-19 possibilities, “We know that the world will still need oil and gas when all of this is over with and done, even at the height of the lockdowns of March and April the world still consumed 75 million barrels of oil per day.”
The OPEC+ countries — whose African member states include Libya (1962), Algeria (1969), Nigeria (1971), Gabon (1975), Angola (2007), Equatorial Guinea (2017) and Congo (2018), are scheduled to reconvene November 17th.