Thanks to OPEC’s revised growth forecasts for demand growth, oil and petroleum prices surge this Thursday. Earlier today, the Organization of Petroleum Exporting Countries revised next year’s deficit forecast.
Oil bulls took bloc’s announcement as an opening to drive futures higher this trading session. Well, since December 5, oil and petroleum prices have fluctuated from positive to negative territories in trading sessions.
WTI crude or West Texas Intermediate contract jumped up 0.20% or 0.12 points this Thursday. A barrel of WTI crude currently trades for $58.88, edging higher from its last close of $58.76.
Meanwhile, benchmark Brent oil futures rallied 0.44% or 0.28 points. The angst from the UK election happening today is also helping boost Brent oil prices higher in sessions.
Brent oil barrels now trade for $64.00, advancing forward from its previous close of $63.72.
The14-member bloc released their report overnight. OPEC said it expects a smaller deficit in the oil and petroleum market in 2020.
This suggests that the market will get tighter than what they previously believed. The new projections marks deeper retreats of a glut in 2020 as US shale productions start to slow.
Meanwhile, the bloc’s production dropped 193,000 BPD last month. In total, OPEC’s output averaged 29.55 million BPD in November.
The Rising Petroleum Giant
Earlier this week, the US Energy Information Administration released a report on oil and petroleum production in the United States.
According to the agency, the US is on track to becoming the top net exporter for crude and fuel. This is due to a massive increase in production that has affected America’s dependency on foreign oil.
This comes timely as the Organization of Petroleum Exporting Countries recently slashed their deficit forecasts as mentioned above.
US crude production is expected to pick up by 930,000 BPD to a record high of 13.18 million BPD. Although the figures are still below the previously expected surge of 1 million BPD according to the EIA.
The country’s oil and petroleum exports are expected to reach 570,000 BPD next year.
Meanwhile, the agency left its demand forecast for US crude consumption unchanged in its recent report.
OPEC for Gas
Elsewhere in the energy sector, aside from the oil and petroleum production, natural gases are also booming. With the global gas stocks evolving and growing quickly than demand, someone needs to take charge.
A gas version for OPEC? More and more analysts are suggesting a governing body for global gas producers.
However, there’s already an organization solely focused on gas production, supply, and demand. The Gas Exporting Countries Forum has a total of 12 countries in its roster.
The organization is led by Russia, Iran, and Qatar, but also includes Nigeria, Egypt, and Libya in its lineup.
As of this year, Russia is the biggest exporter of gas in the world. Experts say that the gas sector is struggling to find clout because there is no known international gas market.
A researcher for energy commodities said that the difference between the oil and petroleum OPEC and gas GECF is markets.
There is already an established crude market even if many environmental activists oppose it. Meanwhile, the gas market has yet to pick up.