ConocoPhillips CEO sees pre-Covid oil demand return in months
(Bloomberg) – ConocoPhillips sees demand for oil return to pre-pandemic levels by early next year as crude consumption rises around the world, supporting rising commodity prices, a CEO Ryan Lance said on Bloomberg TV.
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Oil supply, on the other hand, will remain constrained by both OPEC +, US shale fields and major oil companies embracing the energy transition, he said.
“We are seeing demand improving, we are probably seeing it return to pre-pandemic levels by the end of the fourth quarter or the first quarter of next year and the market become relatively balanced,” Lance said. “We are quite optimistic for the next two years. “
Investment banks and OPEC analysts have raised demand forecasts in recent weeks as economies rebound and the squeeze on natural gas in Europe increases the possibility of power producers going crude. Both trends are positive for oil prices which are up 45% this year but have stagnated below $ 75 a barrel for most of the past few months.
ConocoPhillips’ $ 9.5 billion purchase of the Permian Basin assets from Royal Dutch Shell Plc provides the company with a low cost of supply enabling it to meet demand no matter what in the energy transition, Lance said.
“The world is going through an energy transition, there will be increased demand for the product in the future, so we want to be in the best basins, the cheapest supply basins in the world and that’s what the basin stands for. Permian, ”Lance says mentioned.
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