Low Spare Capacity Seen Keeping Oil Markets Volatile for Years

“Volatility in the oil market is not the result of terror attacks, climatic conditions and security uncertainty only. It is more because of low spare capacity that has dropped sharply,” Gulf oil analyst Hajjaj Bukhdour said Saturday.

Before 2004, worldwide spare capacity exceeded six million barrels per day (bpd) or eight to 10 percent of global consumption. Currently, it is around 1.5 million bpd or just two percent of daily world demand, he said.

“In the coming years, spare capacity could drop to as low as 600,000 bpd. This is what is keeping the oil price under continuous pressure.”
TurkishPress.com