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London / Dubai – News agencies: Three sources in the “OPEC +” group said yesterday, Monday, that most of the group’s countries would like to postpone a planned increase in oil production from February due to weak demand for fuel, amid new global isolation measures to stop the spread of the Corona virus.
And «OPEC +» began yesterday afternoon a meeting of its experts, in which Mohamed Barkindo, Secretary-General of «OPEC» said that he sees the risks of a decline in oil markets in the first half of 2021.
“Amid optimistic signs, the outlook for the first half of 2021 is very mixed, and there are still many downside risks that must be dealt with,” he added.
He also said, “Restrictions on social and economic activity are still in effect in a number of countries, and there is concern after the emergence of a new, highly dangerous strain of the virus.”
Yesterday, Barkindo said that “OPEC” currently expects developing countries to lead the rise in global demand for crude oil to 95.9 million barrels per day in 2021, or by 5.9 million barrels per day for 2020, amid expectations of global economic growth of 4.4 percent.
Despite the optimism that the production of Coronavirus vaccines has spread to the global economy and oil markets, the increase in fuel demand has not yet succeeded in bringing consumption to the pre-pandemic level of approximately 100 million barrels per day.
The latest OPEC forecast in December was lower than previous expectations for an increase of 6.25 million barrels per day due to the continuing effects of the Coronavirus pandemic.
At the close of the last trading days in 2020, the price of Brent crude exceeded $ 50 a barrel, which means it lost more than a fifth of its value on an annual basis, but it is more than two times higher than its lowest levels in April as producers cut production and the United States and the European Union adopted stimulus packages. They are worth trillions of dollars.
The Saudi Energy Minister, Prince Abdulaziz bin Salman, said yesterday that the OPEC + group should be vigilant and cautious despite the generally optimistic market environment, because the demand for fuel is still fragile and the consequences of the new surge of the Coronavirus cannot be predicted.
He added, “In many parts of the world, where infection rates have increased alarmingly, a new wave of closures and restrictions is being applied, which will inevitably affect the rate of economic recovery in those countries.”
Saudi Arabia showed a more cautious approach to increasing production during previous OPEC + meetings, while the UAE, a member of OPEC, and Russia, which is not a member of the organization, said they would prefer a faster increase.
In December, OPEC + decided to increase production by half a million barrels per day, starting in January, within the framework of a gradual increase of up to two million barrels this year. However, some members doubted the need for another increase due to the increase in Coronavirus infections.
The price of Brent crude exceeded $ 53 a barrel on Monday, touching its highest level in several months, thanks to expectations that OPEC + will keep production at current levels in February.
OPEC + was forced to cut production by a record amount in 2020 in light of global isolation measures that reduced fuel demand.
OPEC + reduced production for the first time by 9.7 million barrels per day, then cut the cuts to 7.7 million, and finally to 7.2 million, beginning in January.