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“We are only beginning to emerge from a year of deep investment cuts, huge job losses and the worst crude oil demand destruction on record,” he said.
Prices ended 2020 about 20% below 2019’s average, still recovering from the impact of global lockdown measures, which have slashed fuel demand, even though the world’s major producers agreed record output cuts.
OPEC and allied producers including Russia, a grouping known as OPEC+, decided last month to raise output by 500,000 barrels per day in January, anticipating a boost in demand, and agreed to meet every month to review production.
Analysts from Energy Aspects and RBC Capital said OPEC+ was likely to maintain January production levels in February.
“We think the producer group will opt to forgo any further production increases for February with COVID-19 cases continuing to climb and the slower-than-expected vaccine rollout,” RBC Capital’s Helima Croft said.
In the United States, crude oil production stayed under pressure from weak prices and tepid demand, down more than 2 million barrels per day (bpd) in October from earlier in 2020, a government report showed on Jan. 1. (Reporting by Florence Tan; Editing by Kenneth Maxwell and Sam Holmes)