Apart from EIA and OPEC, even Paris -based IEA expects global oil supplies to increase in 2020. The agency expects non-OPEC production growth to be at 2.1 million barrels per day. When I look at all the above factors in totality, I can see that OPEC+’s combined production cut will definitely support the supply -demand re balancing of crude oil. But then, there are a lot of uncertainties surrounding the U.S. – China trade deal that can have a mixed impact on oil prices, depending on facts and figures.
Even if we combine the bullish impact of the above factors, there will still be a supply glut of 0.6 to 0.7 million barrels till March 2019 (when OPEC and its allies meet again for discussing their future production cuts), and this will continue to put pressure on oil prices in near future. I expect WTI to remain under $60 during the first quarter of 2020. Investors must note this.