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OPEC cut to oil demand outlook builds case to keep supply curbs

OPEC cut to oil demand outlook builds case to keep supply curbs

2019/06/13 | 17:35

(Hatha al-Youm | Iraq News)- OPEC has cut its forecast for global oil demand growth and

warned of potential further cuts as international trade disputes continue to

fester, building a case for prolonged supply restraint over the rest of 2019.The oil producer group and its allies meet in the coming

weeks to decide whether to maintain supply curbs, with some having become

alarmed by a steep slide in prices, despite US President Donald Trump pressing

for action to lower prices.World oil demand will rise by 1.14 million barrels per day

(bpd) this year, 70,000 bpd less than previously expected, the Organization of

the Petroleum Exporting Countries said in a monthly report published on

Thursday.“Throughout the first half of this year, ongoing global

trade tensions have escalated,” OPEC said in the report, adding that the

potential for these disputes to affect global demand poses “significant

downside risks”.OPEC, Russia and other producers have, since Jan. 1, implemented

a deal to cut output by 1.2 million bpd. They meet over June 25-26 or in early

July to decide whether to extend the pact.Despite the supply cut, oil has tumbled to $61 a barrel from

April’s 2019 peak above $75, pressured by fears over the US-China trade dispute

and an economic slowdown, though prices jumped 4% on Thursday after suspected

attacks on two oil tankers in the Gulf of Oman.Vienna-based OPEC also said its output fell in May as US

sanctions on Iran boosted the impact of the supply pact. Production by all 14

OPEC members dropped by 236,000 bpd to 29.88 million bpd, OPEC said.In addition to lowering its demand forecast, OPEC said that

oil inventories in developed economies rose in April, suggesting a trend that

could raise concern over the possible build up of an oil glut.Stocks in April exceeded the five-year average – a yardstick

OPEC watches closely – by 7.6 million barrels.











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