The Organisation of Petroleum Exporting Countries (OPEC) on Wednesday said its growth rate for 2021 is 5.6 percent while that of 2022 stands at 4.2 percent.
Its Secretary-General, Mohammad Barkindo made this known at the 20th OPEC and non-OPEC Ministerial Meeting.
He said: ”the Secretariat has consequently revised upward our global economic growth forecasts for 2021and 2022 by 0.1 percentage points.
“Growth for 2021 now stands at 5.6 percent, while growth for 2022 is now expected at 4.2percent.
He attributed the positive projection to increased COVID-19 vaccination.
He added, however, that several uncertainties continue to impact growth prospects. These include the spread of the Delta variant and the progress of the vaccination rollout- which has shown disparities between developed and developing countries.
The organisation reconfirmed its growth output projection for 2022 as 4.2million barrel per day 4.2mb/d.
It also reconfirmed the production adjustment plan and the monthly production adjustment mechanism approved at the 19th ONOMM and the decision to adjust upward the monthly overall production by 0.4 mb/d for the month of October 2021.
The scribe said: “In fact, the JTC meeting in its deliberations yesterday confirmed robust growth in 2022 with a revised projection at 4.2mb/d.”
He added that it also revised the figure for non-OPEC liquid production for this year to 1.1mb/d.
OPEC further noted that for 2022 the supply forecast for growth is by 2.9mb/d.
The scribe said: “We have revised our figure for non-OPEC liquids production for 2021, which is now forecast to grow by 1.1 mb/d. For 2022, non-OPEC supply our forecast for growth is 2.9 mb/d.”
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He noted that the organisation will closely monitor the impact of Hurricane Ida on production and downstream operations in the Gulf of Mexico.
OPEC recalled that overall conformity to the production adjustments was 110 per cent in July, including Mexico (109 per cent without Mexico), reinforcing the trend of high conformity by Participating Countries.
The meeting noted that while the effects of the COVID-19 pandemic continue to cast some uncertainty, market fundamentals have strengthened and OECD stocks continue to fall as the recovery accelerates.
The Meeting welcomed the positive performance of Participating Countries in the Declaration of Cooperation (DoC).
The organisation said in view of oil market fundamentals and the consensus on its outlook, the Meeting resolved to: “reaffirm the decision of the 10th OPEC and non-OPEC Ministerial meeting on 12 April 2020 and further endorsed in subsequent meetings, including the 19th ONOMM on July 18, 2021.
OPEC “Reconfirmed the production adjustment plan and the monthly production adjustment mechanism approved at the 19th ONOMM and the decision to adjust upward the monthly production by 0.4 mb/d for October 2021.”
According to the organisation, it decided to extend the compensation period until the end of December 2021 as requested by some underperforming countries and request that underperforming countries submit their compensation plans by 17 September 2021.
“Compensation plans should be submitted in accordance with the statement of the 15th ONOMM,” it said.
It reiterated the critical importance of adhering to full conformity and to the compensation mechanism, taking advantage of the extension of the compensation period until the end of December 2021.
It also announced that its 21st OPEC and non-OPEC Ministerial Meeting will hold on October 4, this year.
Barkindo noted that the market analysis and extensive deliberations that took place at the technical level at yesterday’s meeting of the Joint Technical Committee (JTC) have underscored the wisdom of the decision taken at the 19th OPEC and non-OPEC Ministerial Meeting, held on July 18, 2021.
According to him, the improving market outlook and increase in world oil demand vindicates the organisation’s decision to upwardly adjust production levels by 0.4 mb/d on a monthly basis starting August 2021.
He said the the multiplier benefits of the administering of 5 billion vaccines against COVID-19 worldwide continues to be felt in the global economic recovery.
In some regions of the world, said the scribe, economies have reopened, travel has resumed and mobility has increased.
Sovereign debt levels, inflationary pressures and central bank responses all warrant our careful consideration and attention.
Barkindo said after lower than expected growth in 2Q21, the US forecast has been revised down from 6.4percent to 6.1 percent for 2021.
He noted that growth for 2022 is revised up from 3.6percent to 4.1percent. Currently, about 52percent of the US population is fully vaccinated.
OPEC said despite the introduction of strict lockdown measures in 3Q following a prevalent spread of the
Delta variant, China’s 2021 growth forecast remains at 8.5percent. For 2022, it is forecast to be six percent.
He said: “Nearly two billion vaccines against COVID-19 have been administered in China, which accounts for around 40 percent of the global 5 billion total.
“In a positive signal, last week, China reported no new locally transmitted COVID-19 cases.
“Over the course of the last month, there have been some fluctuations in the major benchmarks.
“Crude oil futures prices started the month at generally high levels, extending the gains of the previous month, as the market continued to be supported by strong oil market fundamentals, driven by robust oil demand growth outlooks and expectations of slow global oil supply growth.
“Demand outlooks were bolstered by a strong driving season in the US, improved prospects for road transportation fuels in Europe, firm demand in China, and a steady oil demand recovery in India.
