LONDON – OPEC+ expects the impact on the oil market from the Omicron coronavirus variant to be mild and temporary, keeping the door open for a further increase in output, a technical report seen by Reuters showed on Sunday.
“The impact of the new Omicron variant is expected to be mild and short-lived, as the world becomes better equipped to manage COVID-19 and its related challenges,” the Joint Technical Committee (JTC) report said.
“This is in addition to a steady economic outlook in both the advanced and emerging economies,” it added.
The Organization of the Petroleum Exporting Countries will meet on Monday at 1300 GMT to discuss the appointment of a new secretary general to succeed Nigeria’s Mohammad Barkindo, according to a letter seen by Reuters.
This will be followed by a meeting of OPEC and allies led by Russia, known as OPEC+, on Tuesday, to debate whether to go ahead with raising output targets by 400,000 barrels per day (bpd) in February.
The JTC will also meet on Monday at 1000 GMT to discuss market fundamentals.
In the report’s base scenario, OECD commercial oil stocks in 2022 will remain below the 2015-2019 average in the first three quarters, and rising above that average by 24 million barrels in the fourth quarter.
The scenario assumes 40 million barrels are released from strategic petroleum reserves in the first half of the year, and that 13.3 million barrels are returned to the U.S. strategic reserve in the third quarter.
The report kept forecasts for the growth in oil demand in 2021 and 2022 unchanged at 5.7 million bpd and 4.2 million bpd respectively.