Russia’s oil producer Gazprom Neft believes that global oil demand will return to its pre-pandemic levels in the second half of 2021, chief executive Alexander Dyukov said at an energy forum in Russia on Wednesday.

“Many countries are either expecting or facing a second wave, but we believe that very harsh quarantine measures, like the ones earlier this year especially in Europe, will not be re-imposed,” Dyukov said, as quoted by Russian news agency TASS.  

“We hope oil consumption will return to the pre-crisis levels in the second half of next year,” the CEO of Gazprom Neft said. 

Russia’s Energy Minister Alexander Novak is slightly more optimistic than Dyukov, as Novak said last week that he expects oil demand to recover fully from the effects of the pandemic by the second quarter of 2021.

Global inventories of crude oil declined by 45 million barrels in August after a 34-million-barrel reduction in July, Novak said in a TV interview.

“Reserves accumulated in the second quarter are gradually shrinking, and we see that July and August were the first two months when stocks declined gradually. The reduction roughly amounted to 45 mln barrels in August and 34 [mln barrels] in July,” Novak told Rossiya-24.

Novak said that he expected oil demand to recover fully from the effects of the pandemic by the second quarter of 2021. Even now the oil market is in a supply deficit, amounting to between 1.5 and 2 million bpd, which is helping to reduce inventories, the minister said.

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OPEC and the International Energy Agency (IEA), however, do not believe global oil demand will fully recover from the effect of the pandemic next year.

Last week, the IEA cut its forecast for global oil demand this year, citing an “even more fragile outlook” about the oil market rebalancing and expecting demand to fall by 8.4 million bpd from 2019. OPEC also downgraded its global oil demand forecast for the second time in a row. OPEC now sees oil demand dropping by 9.5 million bpd this year compared to 2019, as risks with the pandemic and economic activity remain skewed to the downside. 

By Tsvetana Paraskova for Oilprice.com

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