Kuwait Sees Balanced Oil Market by Yearend

The oil market is expected to be in balance toward the end of 2019, as global inventories fall and demand remains strong, but OPEC’s job is not done yet, Kuwait’s oil minister told Reuters.

There are still uncertainties around oil demand growth due to concerns about the impact of the US/China trade dispute on global economy, while US shale oil production is still rising, Khaled al-Fadhel said on Monday.

This uncertain outlook is making it tough for OPEC and its allies to have a clear oil supply plan for the second half of the year. Fadhel said it was too early to say now if the oil producers will extend their current output targets after June.

OPEC, Russia and other non-OPEC producers, known as OPEC+, agreed to reduce output by 1.2 million barrels per day from Jan. 1 for six months, a deal designed to stop inventories building up and weakening prices.

“There is great anxiety in the market today mainly related to supply concerns. For example, the impact of the US government decision announced recently not to extend the waivers to major buyers of Iranian crude has yet to be felt,” Fadhel said in written answers to questions from Reuters.

He also cited the possibility of further US sanctions on Venezuela, political tensions in Libya, US shale oil production growth and trade dispute between Washington and Beijing as reasons why the global supply and demand outlook remains unclear.