OPEC forecasts a sharp drop in US oil production in 2020

US, WASHINGTON (ORDO NEWS) — The estimated reduction in US oil production in 2020 was nearly 1.5 million barrels per day. This follows from the OPEC monthly report published on Wednesday, May 13.

According to the document, the forecast for oil supplies from non-OPEC countries in 2020 was reduced by 2.02 million barrels per day to 61.5 million.

This is due to estimates of declining production mainly in North America. OPEC expects a drop in US oil production in 2020 of 1.44 million barrels per day – up to 16.96 million.

A day earlier it was reported that the United States recorded the largest reduction in the number of drilling rigs in history. The total number of horizontal oil rigs fell in the country in April below 270 – 57% lower compared to the peak in 624 rigs in March 2020.

At the end of April, the American oil company Diamond Offshore declared itself close to bankruptcy. It was asked for protection from creditors under Chapter 11 of the Bankruptcy Law.

On April 20, the price of North American WTI oil for May delivery fell for the first time in history to negative values . The cost of May futures for raw materials of this brand by the end of trading on the NYMEX fell by almost 300% – to minus $ 37.63 per barrel.

In March, OPEC countries and other major oil exporters associated with it did not agree to reduce production. Agreement was reached on April 12th. It implies a reduction in oil production by 9.7 million barrels per day in May and June. From July to the end of December, the reduction should reach 7.7 million barrels per day, and from January 2021 to the end of April 2022 – 5.8 million barrels per day.

In December 2021, the parameters of the transaction may be revised.

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