Opec+ sees tighter oil market

The head of Russia's No. 2 oil producer Lukoil said this week that oil prices of US$65-US$75 were “comfortable” for consumers and that the OPEC+ group of leading oil-producing nations was striving to maintain that price range by regulating output.In an interview with the Kommersant newspaper, Vagit Alekperov said curbs on oil output would depend on market conditions.“Regulation [of output] can be different depending on the situation,” Alekperov said.The news comes as Namibia faced its fifth fuel price hike in 2020 late last month. The latest increase saw petrol at the coast bursting through the level of N$14 per litre for the first time this millennium. The price of petrol in the country has increased by N$2.80 per litre or nearly 25% since the beginning of the year, while diesel has become N$2.50 per litre or 22% more expensive.A weak Namibian dollar against the greenback has been the biggest driver in the latest fuel price spike.DEFICITOpec+ expects the oil market to be in deficit at least until the end of 2021 and stocks to stay relatively low until May 2022, Opec+ sources have said.The joint technical committee of the Organisation of the Petroleum Exporting Countries (Opec) and allies led by Russia, collectively known as Opec+, last week presented an updated report on the state of the oil markets in 2021/22.According to the sources, the report, which has not been made public, forecasts a 0.9 million barrel per day (bpd) deficit this year as global demand recovers from the coronavirus pandemic while Opec+ gradually brings back production.Initially, the report had seen a surplus of 2.5 million bpd building in 2022 but it was later revised to a smaller surplus of 1.6 million bpd, according to the sources.As a result, commercial oil inventories in Organisation for Economic Co-operation and Development (OECD) countries will remain below their 2015-2019 average until May 2022 as opposed to the initial forecast for January 2022, the JTC presentation showed, according to the sources.The JTC had expected global oil demand to grow by 5.95 million bpd this year and by 3.28 million bpd next year. It was not clear if those figures have been revised up in the latest report.BALANCEMeanwhile, Russia's top negotiator, Alexander Novak, said OPEC+ has fulfilled a goal of removing excess oil from the global market and it is now important to keep the market balanced.“Joint actions allowed to take away [oil] excess accumulated when demand was down – think we have fulfilled this task. Now it is important to maintain this balance and synchronise production and demand as the market rebounds,” Novak, also a deputy prime minister, said.Global oil demand is seen growing by 5.8-6 million barrels per day this year, Novak also told reporters, adding he saw the global oil market fully restored next year. - Nampa/Reuters and additional reporting

Opec+ sees tighter oil market

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Opec+ sees tighter oil market

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