OPEC+ predicts tighter oil market until May 2022

The Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, collectively known as OPEC+, meet on Wednesday at 1500 GMT to set policy.

Still, the forecast for a tighter market strengthens the case for a speedier output increase by OPEC+ as benchmark Brent oil prices trade close to $73 per barrel - not far off their multi-year highs, Reuters reported.

The comments from sources came as experts from the OPEC+ joint technical committee (JTC) presented an updated report on the state of the oil markets in 2021-2022.

According to the sources, the report, which has not been made public, forecasts a 0.9 million barrel per day (bpd) deficit this year as global demand recovers from the coronavirus pandemic while OPEC+ gradually brings back production.

Initially, the report had seen a surplus of 2.5 million bpd building in 2022 but it was later revised to a smaller surplus of 1.6 million bpd, according to the sources.

As a result, commercial oil inventories in OECD countries will remain below their 2015-2019 average until May 2022 as apposed to the initial forecast for January 2022, the JTC presentation showed, according to the sources.

RHM/PR