The Organization of the Petroleum Exporting Countries, OPEC, raised its projected demand for next year on Monday.
The organization said its next year demand projection has been increased by 400,000 barrels a day to 33.4 million barrel per day. While the so-called ‘call on OPEC’ was also revised up by 200,000 barrel per day for 2017.
The increase in projection was as a result of growing demand that exceeded analysts’ expectations and helped reduce inventories from 2014 global oil glut.
This, combined with the 1.8 mbpd production cuts by the cartel and its allies helped global oil prices and pushed Brent crude oil to over $63 a barrel, up from $34 a barrel of January 2016.
According to OPEC analysts, demand for its crude oil is projected to reach 34 million barrel per day by the second half of 2018, that is about 1.4 mbpd above 32.59 million barrel pumped per day in October.
A secondary source said the cartel pumped 32.59 mbpd in October, down by 150,000 bpd from September production. This, the cartel attributed to fell in Iraq and Nigeria’s oil production.
The organization will be meeting this month to discuss the possibility of extending its production cuts beyond the first quarter of 2018.
In October, OPEC Secretary-General Mohammad Barkindo announced that balanced oil market is insight and assured traders and marketers that production cuts remain effective.
“A balanced oil market is now fully in sight,” Barkindo said at the Oil & Money conference in London on Thursday. “Stability is steadily returning and there is far more light at the end of the dark tunnel we have been traveling down for the past three years.”