Crude oil prices have cooled after the Organisation of Petroleum Exporting Countries said it could easily meet the world’s needs in the second half of the year. The cartel is also forecasting that growth in demand for oil will slow later in the year to just under 84 million barrels a day.
That prediction is based on lower than expected consumption in the last few months. OPEC raised output again in April by 276,000 barrels a day compared with March. It pumped 29.95 million barrels a day in April and that is the average it anticipates for the whole year. OPEC supplies around 40% of the world’s demand. But OPEC’s output has not been matched by refining capacity. That means there are potential bottlenecks that could cause fuel shortages particularly in the US during the summer holiday period when American drivers take to the roads. The other factor that might have an impact on prices is a prediction from the producer group of lower output from non-OPEC countries, especially Russia and Mexico.