The International Energy Agency (IEA) has joined the US Energy Information Administration in lowering its estimates for oil supply recovery following the global pandemic that has destroyed demand and brought oil prices to their lowest in decades, last year.
The IEA in its monthly report still pointed to a tightening oil market this year, despite lowering its estimate of the revival in global oil demand for 2021 and seeing improving non-OPEC supply growth. According to S&P Global Platts, the “fragile rebalancing” will be aided by still reasonable demand growth along with cautious OPEC+ market management and flatlining US output.
The IEA predicts global oil demand will grow by 5.4 million b/d in 2021 to reach 96.4 million b/d, noting this would be around 60% of the volume lost to the pandemic in 2020. The IEA lowered by 100,000 b/d its oil demand outlook for the current quarter, because of the increasing emergence of new variants of the illness.
“The IEA sees US crude supply holding steady at around 11.2 million b/d after falling 940,000 b/d last year, while Canada is now pumping at record rates and Brazil, Norway and Guyana are continuing along their growth trajectories,” Platts said in a report.
Guyana, now producing around 120,000 barrels per day from the Liza Phase 1 Development at the ExxonMobil-operated Stabroek Block, will see output significantly rising in the coming years. Two additional FPSOs have already been approved and will join the Liza Destiny oil production vessel – one by year-end and the other by 2024 – thereby ramping up production to well over 500,000 bpd.
Additionally, ExxonMobil is expected to order 7 more FPSOs, to be added to the 3 already approved, making it a total of around 10 FPSOs in a 10-year period.
Hess, a 30% stakeholder at the Stabroek Block, says it expects production to hit 1.5 million bpd before 2030.