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Snapshot of global oil supply and demand: June 2021

Our dashboard explores key short-term signposts impacting oil demand, supply, and prices.

June 2021 saw an increase in global oil prices driven by reductions in commercial inventories, increasing demand, and higher-than-expected OPEC+ production cuts. Fluctuations in short-term signposts compared to the prior month include:

  • Oil prices. Brent oil prices continued to rise for the 8th month running, reaching >$73/bbl in June. The recovery in oil prices has been driven by increasing demand and higher-than-expected OPEC+ cuts
  • Global oil demand. Oil demand increased by almost 2MMb/d m-o-m in June to 97.9 MMb/d, mainly driven by the US, Europe and the Middle East. Demand is down y-o-y in China, India and Japan, offsetting gains in OECD transport and global aviation
  • Commercial inventories. Commercial inventories continue to decrease and are back to 5-year average levels at 4.6 Billion barrels globally as market balancing continues
  • OPEC production (excl. Iran, Venezuela, Libya). OPEC increased output by 0.7MMb/d m-o-m in line with announced plans to gradually roll back cuts over the summer. OPEC compliance was over 110% signalling higher than expected cuts
  • Non-OPEC production (excl. US shale). Non-OPEC output has continued to rise, increasing by 1.4 MMb/d m-o-m to 57.6 MMb/d driven by Brazil and Canada. Production levels are now getting close to pre-pandemic levels of ~58 MMb/d
  • US shale oil production. US shale production increased slightly m-o-m in June to 7.8MMb/d. This is 1.3MMb/d below January 2020 levels as operators keep prioritizing cash preservation and shareholder returns over growth
  • Iran, Venezuela, Libya production. Production gains of 0.5MMb/d in Iran were offset by output decline in Venezuela in June. Total production from the three countries is now 1.8MMb/d above its lowest point in June 2020
  • Market sentiment. Improving road traffic in major OECD economies driven by successful vaccination efforts offset the concerns from the spread of the Delta variant. On the supply side, OPEC, Russia and other major oil producers failed to agree on the future output cuts after July in the face of increasing demand, with the main sticking point being UAE’s quotas

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