The Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC countries like Russia in significance, decided to proactively increase oil production by 500,000 barrels per day in January 2021. Keeping in view the present oil market specifics and the outlook of oil industry for 2021, OPEC agreed that in the beginning of January 2021, it would adjust oil production by 500,000 bpd. This decision was released in an OPEC statement issued after the 12th OPEC and non-OPEC Ministerial Meeting. This decision means that the group will shift to output curbs by 7.2 million bpd in early 2021, as compared to the present cuts of 7.7 million bpd.
The oil conglomerate group also agreed to conduct monthly ministerial meetings, from January 2021 and take proactive decisions and discuss on further production adjustments for the following month. The group stated that the monthly adjustments would be no more than 500,000 million bpd. The meeting also decided to extend the compensation period until March-end 2021. This is to full compensation of oil from all the participating countries that overproduced a lot during previous months and 2020 in particular.
OPEC and its allies- an oil group together called OPEC+ led by Saudi Arabia and Russia, agreed in April 2020 to cut down output by 9.7 million bpd for May and June as the COVID-19 pandemic situation destroyed oil demand. The group also decided in June 2020 to extend the initial phase of oil output cuts until July. With the group entering the second phase, the cuts are reduced by 7.7 million bpd from August until the end of 2020.
A reduction in economic activity in the COVID-19 pandemic situation has caused global changes in energy demand and supply patterns in the year. This pattern is likely to continue in future too. The Environmental Impact Assessment (EIA) estimated that an average of 95.3 million barrels each day of petroleum and liquid fuels was consumed on a global scale in October. The liquid fuels consumption reduced significantly 5.9 million barrels per day from October 2019, though it increased from both the third-quarter 2020 average of 94.1 million barrels per day and the second-quarter 2020 average of 85.3 million barrels per day. The EIA report also forecasts that the global consumption of petroleum and liquid fuels will stand at an average 92.9 million barrels per day throughout 2020, which is a reduction by 8.6 million barrels per day from 2019, before it will see an increase by 5.9 million barrels per day in 2021.
| Global Petroleum and Other Liquids | ||||
| 2018 | 2019 | 2020 | 2021 | |
| Supply & Consumption | (million barrels per day) | |||
| Non-OPEC Production | 64.02 | 65.98 | 63.74 | 64.88 |
| OPEC Production | 36.75 | 34.63 | 30.69 | 33.50 |
| OPEC Crude Oil Portion | 31.44 | 29.27 | 25.71 | 28.52 |
| Total World Production | 100.78 | 100.61 | 94.42 | 98.39 |
| OECD Commercial Inventory (end-of-year) | 2,859 | 2,879 | 2,982 | 2,927 |
| Total OPEC surplus crude oil production capacity | 1.56 | 2.52 | 6.01 | 3.75 |
| OECD Consumption | 47.85 | 47.61 | 42.28 | 45.07 |
| Non-OECD Consumption | 52.78 | 53.91 | 50.62 | 53.73 |
| Total World Consumption | 100.62 | 101.52 | 92.91 | 98.80 |
