Global oil supply to rise in 2020

Global oil supply to rise in 2020

"It seems likely that OPEC will roll over the current supply cuts at the next meeting", said Callum MacPherson, head of commodities at investment bank Investec.

Russian Federation said on Monday it might support an extension of OPEC-led supply cuts that have been in place since January, while equities rose after China eased financing rules to stem an economic downturn, giving oil a lift.

Oil steadied above $62 a barrel on Tuesday as firmer equities and expectations OPEC and its allies will keep withholding supply countered concern about slowing economies and demand.

EIA forecast Brent spot prices will average 67 dollars per barrel in 2019, 3 dollars per barrel lower than the forecast in last month's STEO, and remain at 67 dollars per barrel in 2020. US West Texas Intermediate was up $0.4 at $53.66.

In the United States, crude production has surged, rising to a weekly record at 12.4 million barrels per day, while crude stockpiles have climbed close to two-year highs, according to the Energy Information Administration's data last week.

"Indeed, comments from Novak yesterday that Russian Federation is anxious about oversupply and potentially $40/bbl oil in the second half of the year has further strengthened our view that OPEC+ will agree on an extension to their production cuts".

Both ministers are due to meet colleagues from the Organization of Petroleum Exporting Countries and allied producers at talks in Vienna in the coming weeks to decide on the future of the deal. -China trade tensions continued to threaten demand for crude and as major producers Saudi Arabia and Russian Federation had yet to agree on extending an output-cutting deal.

Energy consultancy FGE said global crude demand growth could drop below 1 million bpd in 2019 from the 1.3 to 1.4 million bpd expected previously.

But analysts said there were still concerns about the health of the global economy, with the United States and China still locked in a trade war.

Market participants await industry data on US crude stockpiles, due out at 4:30 p.m. EDT (2030 GMT), that is expected to show inventories fell 500,000 barrels last week from almost two-year highs. The American Petroleum Institute (API), an industry group, issues its report at 2030 GMT.

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