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Oil demand has ‘upside potential’, says OPEC secretary general

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Oil demand has ‘upside potential’, says OPEC secretary general

Although the worldwide oil demand forecasts have been quite lower than in previous years, OPEC Secretary-General Mohammed Barkindo stated Friday that demand growth is still “robust” and could start ascending over the course of 2020 as trade tensions settle down, as reported by CNBC after having a discussion with Barkindo.

“By and large what we see from our side is an upside potential of growth from the demand side of the equation, which will affect the total balance for the rest of the year. We are hoping that some of the challenges that we’re facing in terms of international trade will be addressed,” Barkindo told CNBC.

Oil ended 2019 by gaining nearly 35%, but prices continue to remain well below their prior highs. One reason for this situation is due to the surge of shale production in the United States, which, according to Barkindo, is a “major variable” in OPEC’s decisions.

“We remain focused on stability for the first and second quarter of 2020. The decision was to ensure that there’s no imbalance in these quarters,” Barkindo said. “But the total equation is looking at both supply and demand sides. We can only address the supply side of the equation. The demand side is something that we watch with very keen interest,” he added.

(Reference: CNBC)