Oil demand will grow next year, but at a slower rate than in 2018 due to higher oil prices in late 2018 and slowing economic growth, Robin Mills, the CEO of Qamar Energy in Dubai, told Trend.
He said that some rebounds from current levels are expected with Brent oil prices generally in the range of $60-70 per barrel.
Mills underlined that among the key factors, which will affect the oil market next year are the progress of sanctions on Iran and Iran’s response to them and global economic growth, particularly in China.
Speaking of the OPEC deal, the expert noted that the Cartel should target moderate prices in the range of $50-60 per barrel, accept some growth of the US shale, but try to encourage demand and limit other non-OPEC growth.
"At the same time, economic and budgetary reforms should be made to allow oil producers to cope with a longer period of relatively low prices," Mills explained.
OPEC and non-OPEC producers reached an agreement in December 2016 to curtail oil output jointly and ease a global glut after more than two years of low prices. OPEC agreed to slash the output by 1.2 million barrels per day from Jan. 1.
Non-OPEC oil producers, such as Azerbaijan, Bahrain, Brunei, Equatorial Guinea, Kazakhstan, Malaysia, Mexico, Oman, Russia, Sudan and South Sudan agreed to reduce output by 558,000 barrels per day starting from Jan. 1, 2017.
OPEC and its partners decided to extend production cuts until the end of 2018 in Vienna on Nov. 30, as the oil cartel and its allies step up their attempt to end a three-year supply glut that has savaged crude prices and the global energy industry.