Global oil market

UAE Energy Minister Suhail al-Mazrouei said on Thursday that Introduction of COVID-19 vaccines and improved US-China relations could increase oil demand.

Oil prices have plunged in recent days and may end the week with a decline - for the first time since October, on concerns over the spread of a new coronavirus and restrictive measures in Europe.

The UAE, however, is not worried about the news of coronavirus mutation. Al-Mazrui predicts recovery of the global oil demand in 2021, but does not believe it will be instantaneous.

"The recovery will be gradual and will not happen in one or two quarters," the UAE Energy Minister said in foreign media.

He also believes that the actions of the OPEC + countries have successfully mitigated the impact of lower demand on oil prices, and hopes for more countries to join OPEC + in the future.

If we talk about near future perspectives of the global oil market in the pandemic context, we should take a closer look at the situation with oil production in the United States, said William Harwood, senior vice president of business development in Eurasia at Argus.

“US oil production demonstrates a fundamental factor. The OPEC + agreement was concluded by countries that pursued their own specific goals, but the United States never sympathized with any restrictive measures. The United States likes it when everything on the market goes according to market factors. This is a paradox in the global oil market that will be very difficult to resolve in the near future, ” said Mr. Harwood, speaking during an online conference on the topic “Argus.  Oil and Gas Market of Kazakhstan and Central Asia - 2020 " on Thursday.  According to him, over the past two quarters, there has been a positive trend in oil production in the United States: an increase from 10.5 million barrels per day to just over 11 million barrels per day, which will lead to an excess of supply on the market.

Note that in early December, Fitch announced that oil demand will not fully recover until the end of 2021, unless there is a massive vaccination of the population.

According to the latest data, futures for Brent crude for delivery in March rose by $ 0.25 to $ 51.3 per barrel. WTI rose 0.37% to $ 48.3.