Bloomberg: three months oil will be nowhere to go, and the first

Bloomberg: three months oil will be nowhere to go, and the first Bloomberg: three months oil will be nowhere to go, and the first “choke” Russia
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the World is on the verge of exhaustion of free space to store unclaimed oil. This will happen only after three months, according to industry experts quoted by Bloomberg. Before the other major players in your storage will fill to the brim with Russia.

According to calculations of the consulting company IHS, Markit, the current pace of supply and demand mean that the reserves will increase by 1.8 billion barrels after the first half of 2020. Given that is still only available to about 1.6 billion barrels of storage capacity, producers will be forced to cut production because by June, no place to store oil.

In some countries the limit has already been reached. 26 Mar Pakistan banned the import of oil and fuel, because its storage is full. Vitol Group and Gunvor Group, two of the world’s leading trader, saying that there is great interest in storage, as some traders booked supertankers to store oil at sea.

the Offer can exceed demand at 12.4 million barrels per day in the second quarter, while other traders, banks and consultants have also predicted significant excess, according to IHS. On Wednesday, Vitol said that compared to last year the demand fell by 20 million barrels a day, reports “Interfax”.

“the Prey will need to reduce or even to stop. Now the question is where and by how much,” said Jim Burkhard, the head of the navetanim markets IHS.

According to the IHS analysis, three of the world’s largest oil producers, Russia has the least amount of available storage is approximately eight days. These figures are based on the volume of production that can be saved if the export runs out. Saudi Arabia has in reserve for 18 days, and in the US 30 days.

Nigeria, the largest producer in Africa, is the most vulnerable country, said IHS. According to company estimates, the estimated daily production in the first quarter of 2020, 1.9 million barrels will fill available local storage for 1.5-2 days.

As said consultant Wood Mackenzie Lay San, the largest importer in the world – China – in January and February increased storage of oil by 2.5 million barrels per day as refineries reduced performance at the peak of viral infection in the country. The country is likely to continue to increase the amount of storage of crude oil strategic reserves in 2020, but loose power over there.

According to the consulting company Energy Aspect, “as OPEC pushing production to record highs, stocks will quickly get out of control.” “Early in the third quarter of 2020 we will be over capacity for oil storage and facilities for storage of petroleum products will end earlier”, – consider in the company.

Note that glut in the oil market is due not only to the pandemic of mers because of the combat which stops production and falling consumption, but also the beginning of the economic “war of attrition” between Saudi Arabia and Russia. It provoked a demonstrative RF output of OPEC transactions+ that signalled Moscow’s willingness to increase oil production. In the end, the same solutions were taken and other exporters. This has already led to a significant drop in oil prices, which Moscow more and more difficult to sell for other reasons. So, China started to abandon hydrocarbons “Rosneft” because of U.S. sanctions against Russia.

Experts believe that even the first effects of the “oil war” for Russia are disastrous. However, in the Kremlin deny it.