Following the expectation of high oil demand, the petroleum exporting countries (OPEC) has announced that there will be an increase in the production and exportation of crude oil by September.
This was disclosed by the President of OPEC, Mohammad Al-Sada.
Al-Sada said since February 2016, oil prices had experienced a steady improvement following a decline in crude oil production, supply outages and a decrease in oil inventories, while the global demand for oil improved in that period.
According to OPEC secretariat, Al-Sada said that the recent decline observed in oil prices and the current market volatility is only temporary.
“These are more of an outcome resulting from weaker refinery margins, inventory overhang – particularly of product stocks, timing of Brexit and its impact on the financial futures markets, including that of crude oil,” he said.
OPEC basket price as at Monday stood at $40.08 a barrel, compared with $39.60 on Friday, while Brent crude opened around $42.
Al-Sada added that the economies of major oil consuming countries are expected to improve, which in turn would augment oil demand in the coming quarters, especially in preparation for the approaching winter season in the northern hemisphere.