Global oil market to lapse into surplus in 2019 as demand slows

Mae Love
November 15, 2018

The agency raised its forecast for oil output growth from countries outside the Organisation of Petroleum Exporting Countries to 2.4 million bpd this year and 1.9 million bpd next year, versus its previous estimate of 2.2 million bpd and 1.8 million bpd, respectively.

Global benchmark Brent crude dropped nearly 7% to $65.11 (£50.24) a barrel, its lowest level since March.

Brent oil prices have plunged 25 per cent since reaching a four-year high of more than $86 per barrel in early October.

The slump in spot prices has turned the entire forward curve for crude oil upside down.

The selling leading up to Wednesday was further exacerbated as traders unwound long oil - short natural gas trade, market participants said.

Oil erased losses amid renewed speculation that OPEC and its allies are considering curbing supply next year.

"In no short period of time this trade has imploded", MBF Clearing founder and CEO Mark Fisher told CNBC on Wednesday.

Saudi Arabia's Oil Minister Khalid al-Falih announced on Monday that the kingdom would cut oil production despite warnings from President Donald Trump.

With eyes on prize, Butler arrives, shares Sixers' vision
This move also makes sense because Fultz plays off the ball quite often, since Ben Simmons is the team's primary playmaker. Butler expressed confidence in Fultz during the press conference.

Kensington Palace Just Released Your New Favorite Photos of the Royal Fam
Prince Charles' 34-year-old son, Prince Harry is also in the photo, with his new wife, 37-year-old Meghan Markle . The family is seen aboard the Royal Yacht Britannia during a three-week tour of Italy, which ended in Venice.

Wizards Unite First Official Teaser Trailer: Trailer Analysis and Breakdown
There's no set release date for Wizards Unite yet, just that it's coming in 2019. "Please resist the urge to panic". Harry Potter: Wizard Unite will arrive on Android and Apple iOS devices in 2019.

Oil markets are being pressured from two sides: a surge in supply and increasing concerns about an economic slowdown, as seen with the economic contractions in powerhouses Japan and Germany during the third quarter as well as in China's falling vehicle sales.

A supply cut of up to 1.4 million bpd was one of the options discussed by energy ministers from Saudi Arabia, non-OPEC Russia and other nations at a meeting in Abu Dhabi on Sunday, the sources said.

Yawger noted that the potential pullback in Saudi output has in part already been made up by the sharp bump in US production, which reached 11.6 million bpd in the most recent week, a new record.

The 14-member Opec expects oil supply from its rivals to outpace its own output next year. The cartel added that output rose by 127,000 bpd to 32.9 million bpd.

For the first half of 2019, based on its outlook for non-OPEC production and global demand, and assuming flat OPEC production, the IEA said the implied stock build is 2 million bpd.

Most analysts expect United States output to climb above 12-million barrels a day within the first half of 2019.

Anxious by a drop in oil prices and rising supplies, the Organization of the Petroleum Exporting Countries is talking again of reducing production just months after increasing it.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER