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OPEC+ Can Manage 2019, but Maybe Not 2020

Hellenic Shipping News: Weak demand and soft crude oil prices mean that early next week the OPEC+ countries should extend their production restraint another six months. They will be rewarded with higher crude oil prices (unless the trade dispute significantly worsens, or further chaos comes out of the G20 meeting). It would be in the best interests of the group to extend this production restraint again in six months, as the call on OPEC falls further in 2020. But it will be harder to do so because, ceteris paribus, oil prices will be higher, and some of the current overcompliance will be gone, and some undercompliance will have set in. That does not bode well for agreeing to another extension. This will eventually put downward pressure on prices, even with the distillate demand requirements that accompany the IMO.

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Brazil’s Crude Growth Set for Takeoff

World Pipelines: Brazil’s crude production growth, off to a slow start so far in 2019, is about to ramp up quickly, according to ESAI Energy’s Latin America Watch publication released on 25 June. The increase in medium crude will be one of the few sources of non-US supply growth this year.

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