LONDON—A worsening global oil demand outlook will prompt OPEC to reverse a planned easing of oil cuts in 2021 with Saudi Arabia offering deeper cuts below its current quota, J.P. Morgan said in a research note.
“Against relatively bearish investor sentiment on the near-term demand outlook as COVID-19 potentially accelerates infections into winter, we highlight the potential for Saudi to drive incremental cuts at the Nov. 30 OPEC meeting,” analysts including Christyan Malek said in a note.
“Our base case is a reversal of the 1.9 million barrels per day output increase slated for 2021 with an upside scenario of a deeper cut whereby Saudi reduces its own quotas even lower (in the event of a worsening demand outlook),” J.P. Morgan said.
U.S. energy firms this week added oil and natural gas rigs for a seventh week in a row for the first time since June 2018, and for a third consecutive month, even as oil majors cut spending due to the COVID-19 pandemic's impact on energy demand and prices.
Two Weld County wells in the Wattenberg Field completed by Occidental Petroleum plus results from a Wilcox discovery by Exxon Mobil in the Gulf of Mexico top this week’s drilling activity highlights from around the world.
Just 18 of 62 planned wells were completed.