The Organisation of Petroleum Exporting Countries (OPEC) has said that the global oil supply market could have as much as 240 million barrels of emergency crude oil by October.
OPEC Secretary-General, Dr Sanusi Barkindo, made this known at the opening of the 62nd meeting of the Joint Technical Committee (JTC) on Wednesday.
The Nigerian stated that the current non-fundamental driving oil prices, such as the COVID-19 and the Russia-Ukrain crisis, were beyond the body’s control.
Barkindo noted that the Covid-19 pandemic clearly remained with the world as had been evident most recently with lockdowns across China, with its impact on transportation fuels and petrochemical feedstock.
The OPEC boss further stated that the conflict between Russia and Ukraine has compounded the uncertainties and led to further economic volatility and elevated risk premiums for oil.
He said: “The crises we face are causing huge volatility, with daily price swings of more than $5/b occurring on 13 occasions across March and April.
“I must point out, however, that the non-fundamental factors are elements that we as producers have no control over. What we can do is what we have always done – and that is to continue collaborating through DoC actions to help support market stability and economic growth.”
Barkindo described the month of April 2020 as perhaps the darkest and most sudden downturn in the history of the oil industry when global oil demand dropped by more than 20 million barrels a day (mb/d), and industries and populations locked down.
He added that the assessment for 2022 had dropped from 4.2 per cent to 3.9 per cent taking into account the implications of the conflict in Ukraine, as well as the ongoing effects of the pandemic.
“Global oil demand growth for 2021 remains similar to last month, at 5.7 mb/d, but 2022 growth has been revised down by 0.5 mb/d to stand at 3.7 mb/d. This mostly reflects the downward revision in world economic growth,” he stressed.
He confirmed that the latest data showed that OPEC production conformity levels reached 157 per cent in March, and stand at 113 per cent overall since May 2020.