The Impact of COVID-۱۹ on Oil Supply in the Short Term

The global oil industry is experiencing a major crisis as the COVID-۱۹ pandemic endures. According to Standard and Poor’s (S&P) Global Plats, the energy analytics firm, the coronavirus has reduced global oil demand by as much as ۴ percent or ۴.۱ million barrels a day in February ۲۰۲۰.for the full-year, to one million barrels. As of early April, Brent crude oil was trading at ۳۰$/b. The disruption of the entire sector and the consequent loss of export earnings, a threat to livelihoods, and an end to the potentially progressive development trajectories is a major concern for many developing countries. The survival economy of oil-dependent countries are heavily reliant on oil production and losing this market is a huge shock, simultaneously, in ۱۷۸ the extraordinary meeting of the Organization of the Petroleum Exporting Countries (OPEC) commended all OPEC and non-OPEC countries meeting a further adjustment of ۱.۵ Mb/d until ۳۰ June ۲۰۲۰ to be applied pro-rate between OPEC(۱.۰ Mb/d) and non-OPEC producing countries(۰.۵mb/d) participating in the declaration of cooperation in order to achieve a sustainable balance and stability in the market. Energy Information Administration (EIA) expects Brent crude oil prices will rise to an average of ۴۱.۶۹$/b during the second half of ۲۰۲۰ and ۶۵.۱۹$/b on average in ۲۰۲۲, reaching ۶۰$/b by the end of the year.