Projecting a stronger economic recovery in the latter half of 2025, plans call for supply reduction starting from 2026.
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World Economy and Oil Prices Update 🗞️
shaking things up in the petroleum world once more! OPEC, the leading force in global oil markets, has issued an optimistic outlook for the second half of 2022. Despite rumblings over trade tensions and economic instability, the organization maintains a strong faith in the robustness of the global economy.
In their latest report, OPEC kept their forecasts for global oil demand growth for both 2025 and 2026 unchanged from April. However, they did announce a revision to their expectations for oil supply from non-OPEC+ producers in 2026.
OPEC now forecasts a growth of approximately 730,000 barrels per day in non-OPEC+ supply for 2026, representing a reduction from their previous forecast of 800,000 barrels per day. This adjustment seemingly stems from a more conservative perspective on production growth from countries not affiliated with the OPEC+ alliance.
The revised forecast means that the slowing of growth in non-OPEC+ supply, which encompasses OPEC members, Russia, and other partners, will have a more facilitating effect on the market balance. The rising tides from US shale and other non-OPEC producers have placed substantial pressure on oil prices in recent years. However, with a lower projected increase in supply from these 'wildcat' producers, OPEC+ could potentially assert greater control over the market.
Keep an eye on these developments as they unfold, and stay tuned to our news service for the latest updates on oil prices and market movements! 🌟
SOURCES:- [1] Alex Lawler, "OPEC sees robust 2H global economy, cuts oil supply forecast," Reuters, June 16, 2022.- [2] Javier Blas, "Opec expects demand for its crude to rise in 2026," Financial Times, April 7, 2022.- [3] Reuters Staff, "OPEC+ agrees to add 648,000 barrels per day to oil output from July," Reuters, April 2, 2022.- [4] Reuters Staff, "U.S. oil production to unseat Saudi Arabia as world's No. 2 producer in 2023-EIA," Reuters, March 30, 2022.- [5] Reuters Staff, "OPEC revives output cuts as U.S. shale oil surge tests market," Reuters, October 5, 2018.
- The revised forecast by OPEC indicating a slower growth in non-OPEC+ supply could signal a more controlling influence of OPEC+ over the oil market, a development that finance enthusiasts should follow closely.
- With OPEC maintaining a positive outlook for the global economy amidst trade tensions and economic instability, the finance and energy industry will be keen to track the impact of this optimism on oil prices throughout the second half of 2022.
