OPEC sees small 2020 oil deficit even before latest supply cut

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OPEC on Wednesday pointed to a small deficit in the oil market next year due to restraint by Saudi Arabia even before the latest supply pact with other producers takes effect, suggesting a tighter market than previously thought.

In a monthly report, OPEC said demand for its crude will average 29.58 million barrels per day (bpd) next year. That points to a 30,000 bpd deficit if OPEC keeps pumping at November’s rate. Previous reports had suggested a surplus.

The Organization of the Petroleum Exporting Countries, Russia and other producers, a group known as OPEC+, have since Jan. 1 implemented a deal to cut output by 1.2 million bpd to support the market.

At meetings last week, OPEC+ agreed to a further cut of 500,000 bpd as of Jan. 1 2020.

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