U.S. oil production is expected to grow more slowly in 2020 and drop outright in 2021, forecasters said this week after U.S. shale producers cut investment plans further when OPEC and Russia refused to steepen output cuts and prices plunged, APA reports quoting Reuters.
Forecasters and international agencies have warned that demand will grow more slowly due to the global coronavirus outbreak, and the International Energy Agency (IEA) said oil consumption would actually drop in 2020. The disease has been classified as a pandemic, and a Reuters tally showed more than 119,100 people infected around the world, with about 4,300 deaths.
The price war between Saudi Arabia and Russia caused oil prices to fall more than 20% this week.
On Monday, the IEA forecast the first decline in annual demand since 2009, saying the virus outbreak led to a massive, 2.5-million-barrel-per-day contraction for the first quarter. The agency cut its 2020 forecast and said demand would contract by 90,000 bpd from 2019.