# OPEC Expects 2021 Crude Oil Demand Recovery in Second Half

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Last modified: 2021-05-05

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By Paul Ebeling · 2021-05-05
Tags: oil, OPEC, demand, USO, Crude, Headline News, Paul Ebeling, Crude Oil, Coronavirus, 2021
Signed: no (published before platform launch).
Nothing in this article is investment advice.

#OPEC #oil #demand

$OIL $USO

OPEC says that a recovery in Crude Oil demand will be focused on 2-H of the yr as the impact of the VirusCasedemic lingers as a headwind for the group and its allies in supporting the market.

In a monthly report, the Organization of the Petroleum Exporting Countries said demand will rise by 5.89-M BPD in Y 2021. 

"*Total oil demand is foreseen to reach 96.3 million bpd with most consumption appearing in the second half,*" OPEC said in the report.

"*This year's demand growth will not be able to compensate for the major shortfall from 2020 as mobility is forecast to remain impaired throughout 2021*."

The latest forecasts could boost cautious views among OPEC and its allies, known as OPEC+, on how quickly to unwind more of last yr's record oil output cuts. 

OPEC raised its forecast of world economic growth this year to 5.1% from 4.8% as activity accelerates by the end of 1-H. Still, it sees the mobility restrictions continuing to dampen Crude Oil demand, despite faster growth.

"*Oil-intensive sectors, especially travel and transportation, will remain disproportionately affected, with a larger negative impact on 2020 oil demand and a lower positive contribution to 2021 oil demand, relative to global economic growth,*" OPEC said.

While the curbs persist, rivals are boosting supply and OPEC raised its forecast of non-OPEC output growth to almost 1-M BPD led by Canada, the United States, Norway and Brazil.

Partly due to the higher non-OPEC supply forecast, OPEC trimmed its estimate of global demand for its Crude Oil to 27.3-M BPD this yr. This still allows for higher average OPEC production in 2021.

Have a healthy day, Keep the Faith!

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