OPEC sticks to forecast of oil demand surge in second half of 2021

Shafaq News / OPEC stuck to its prediction of a strong world oil demand recovery in 2021 led by the United States and China, although it cited uncertainties around the path of the pandemic, Reuters reported.

In a monthly report on Thursday, the Organization of the Petroleum Exporting Countries said demand would rise by 5.95 million barrels per day (bpd) this year, or 6.6%. The forecast was unchanged for a second consecutive month.

The report's forecast comes even after a slower-than-expected recovery in the first half of this year, and as it warns of "significant uncertainties," around the pandemic, such as the potential emergence of new variants.

OPEC sees 2021 world economic growth at 5.5%, unchanged from last month, assuming the impact of the pandemic will have been "largely contained" by the beginning of the second half.

Oil was trading above $72 a barrel before the report was released. The price has gained 39% this year on rising demand and supply cuts by OPEC and its allies, known as OPEC+.

OPEC+ agreed in April to gradually ease oil output cuts from May to July and confirmed the decision at a meeting on June 1. Most of its output cuts will remain after July.

The efforts of OPEC+ have "have substantially led the way towards a market rebalance," OPEC said.