BP's Irish boss sees oil demand lasting long time

Oil industry executives are encouraged by a robust rebound from the pandemic in the US, China and Europe

BP chief executive Bernard Looney: 'There is a lot of evidence that suggests that demand will be strong, and the shale seems to be remaining disciplined. I think that the situation we’re in at the moment could last like this for a while.'
 

Energy giant BP sees a strong recovery in global crude demand and expects it to last for some time, with US shale production being kept in check, according to CEO Bernard Looney.

“There is a lot of evidence that suggests that demand will be strong, and the shale seems to be remaining disciplined. I think that the situation we’re in at the moment could last like this for a while,” Mr Looney said.

Mr Looney’s comments echo those of other industry executives encouraged by a robust rebound from the pandemic in the US, China and Europe.

Brent crude closed above $70 a barrel last week for the first time in more than two years, as mass vaccinations help to reopen some economies in the northern hemisphere and improve mobility and oil consumption.

Oil’s demand recovery will be at the point of maximum velocity this month and in July, and it may reach 100 million barrels a day by December, according to a recent report from Standard Chartered.

Conservative approach

So far, Opec and its allies are sticking to a conservative approach. While it last week confirmed its plan to ramp up output in July, it didn’t provide guidance as to whether more barrels will be added later this year until there’s evidence more crude is needed.

Opec+ has to manage the risk of the potential return of Iran barrels, along with any spike in cases of Covid-19.

• Bloomberg