Abstract
Significance Rising Chinese imports and falling inventories point to demand exceeding supply at present. However, concerns over how quickly, reliably and fully oil consumption will recover cloud the outlook for prices, alongside doubts over the ability of OPEC+ to maintain supply restraint in the face of rising output by non-OPEC producers. Impacts Higher oil prices will bring some fiscal relief to oil-producing countries, but the financial position of many will remain weak. The price increase is unlikely to reverse the recent pivot of European oil majors towards more sustainable technologies. OPEC+ cooperation will continue given the common interest in stable prices, but less cohesion will moderate the group's ambition. Libyan oil output, which had resumed 2019 levels, is facing more disruption and the prospects for higher Iranian output remain uncertain.
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