The Energy Information Administration released its Short-Term Energy Outlook for July, and it shows that OECD oil inventories likely bottomed in this cycle in June 2018 at 2.804 billion barrels. It estimated stocks dropped by 14 million barrels in June to end at 3.283 billion, 362 million barrels higher than a year ago. It estimates that inventories peaked in May 2020 at 3.297 billion.
The EIA estimated global oil production at 87.59 million barrels per day (mmbd) for June, compared to global oil consumption of 89.47 mmbd. That implies an undersupply of 1.87 mmbd or 56 million barrels for the month. However, that is still a small figure compared to the size of the build from February, which was 399 million barrels.
For 2020, OECD inventories are projected to build by 132 million barrels to 3.022 billion. For 2021 it forecasts that stocks will draw by 137 million barrels to end the year at 2.855 billion.
The EIA forecast was made to incorporate the OPEC+ decision to cut production and exports. According to OPEC’s press release: Continue reading "World Oil Supply And Price Outlook, July 2020"