Oil Supply Deficit May Occur in Second Half of 2020, May Help to Stabilize Market - IEA
Oil supply deficit may occur in the second half of 2020, as the OPEC+, as well as some of the G20 oil producing countries, will move to slash the output, and that may help to bring the market back to normal conditions, the International Energy Agency (IEA) said in a new monthly report on Wednesday
MOSCOW (Pakistan Point News / Sputnik - 15th April, 2020) Oil supply deficit may occur in the second half of 2020, as the OPEC+, as well as some of the G20 oil producing countries, will move to slash the output, and that may help to bring the market back to normal conditions, the International Energy Agency (IEA) said in a new monthly report on Wednesday.
"The loss of this supply combined with the OPEC+ cuts will shift the market into a deficit in the second half of 2020, ensuring an end to the build-up of stocks and a return to more normal market conditions," the report noted.
The second half of 2020 may even see the demand exceeding supply even though currently the oil market suffers gravely from the falling demand and an increased output, the agency noted.
"If production does fall sharply, some oil goes into strategic stocks, and demand begins to recover, the second half of 2020 will see demand exceed supply. This will enable the market to start reducing the massive stock overhang that is building up in the first half of the year. Indeed, our current demand and supply estimates imply a stock draw of 4.7 mb/d in the second half," the IEA said.