December 2020, the last month of the year was not pleasant for many oil producing nations, as Nigeria had minus one in its rig count, having recorded seven, as against eight recorded in November, while the Organisation of Petroleum Exporting Countries, OPEC suffered a massive minus 11, as it had 318 in December, as against 329 in November, latest data from OPEC shows.

This is coming at a time world rig count recorded a surge of 22.  Among the 13 OPEC members, only Iraq had a positive progression, having seen its rig count rise by three, as it had 30 in December, as against 27 recorded in November. Algeria led the loser’s group with its minus seven, having had 22, as against 29 recorded within the period under review. It was followed by Kuwait, which had minus three, as its rig count showed 28, as against 31 shown within the period under review. Three other OPEC members had minus one respectively. Libya had 11 as against 12, Saudi Arabia had 59 as against 60, while the United Arab Emirates (UAE) recorded 40 as against 41, all within the period under review. Six other OPEC members recorded zero in their rig count. Angola, Congo, Equatorial Guinea, Gabon, Iran and Venezuela had 3, 0, 1, 0, 117 and 0, respectively.

The United States had its rig count surge by 30, as it recorded 341 in December, as against 311 recorded in November. Similar increase of 30 was recorded by the Organisation for Economic Cooperation and Development, OECD Americas, which had 473 in December, as against 443 recorded in November. Mexico also had plus four, as it recorded 41, as against 37 recorded within the period under review. Canada is the only country within the region that had a decline. Its rig count declined by four, as it witnessed 91, as against 95 recorded within the period under review.

World Oil Demand

The latest OPEC data also showed that world oil demand growth in 2020 was revised marginally higher from last month’s report and is now estimated to have declined by 9.8 million barrels daily, mb/d year-on-year (y-o-y) to average 90.0 mb/d in 2020. OECD America, led by the United States, was revised lower particularly in the second half of year 2020 (2H20) amid a sluggish recovery in transportation fuels. In the non-OECD region, oil demand growth was revised higher in 2020, mainly reflecting better-than-expected demand in China and India. Strong petrochemical feedstock demand along with a healthy uptick in gasoline requirements supported the upward revision in both countries.

For 2021, global oil demand is forecast to increase by 5.9 mb/d y-o-y to average 95.9 mb/d. The growth forecast was kept unchanged compared to last month’s assessment. In the OECD region, oil consumption is estimated to increase by 2.6 mb/d y-o-y but will still lag pre-pandemic levels. OECD Americas is estimated to increase the most amid a rebound in transportation fuels. In the non-OECD region, oil demand is estimated to increase by 3.3 mb/d y-o-y, driven by China followed by India and Other Asia, and supported by a rebound in economic activities.