Published once a year by OPEC, the World Oil Outlook is a big deal for Oil markets as it provides critical insight into the outlook for Oil in the period ahead. This year the WOO report will be of significant importance due to oil prices going sub-zero for the first time in history, and complicated supply/demand-side dynamics caused by COVID-19.

 

It is widely known that Oil remains one of the biggest casualties from COVID-19. When the world went on lockdown earlier in the year as coronavirus cases skyrocketed, demand for Oil simply evaporated. Fast forward today, both WTI Crude and Brent are still down over 30% year-to-date and remain pressured by demand-side factors.

 

Given the state of the global economy, it will be interesting to see whether OPEC’s projections through the year 2045 adopt either a more hopeful or realistic tone. It must be kept in mind that Oil not only remains pressured by demand-side factors but supply-side themes in the form of non-compliance among some of its members. Questions are already being raised whether the group will extend the current level of cuts past December. The idea of more supply returning to markets at a time where demand remains threatened by rising coronavirus cases across the globe and renewed lockdown restrictions is bad news for Oil bulls.