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Rystad: Largest oil supply surplus to hit in April

The largest oil supply surplus the world has ever seen in a single quarter is about to hit the global market from April, creating an imbalance of around 10 million barrels per day (bpd), according to analysis by energy research firm Rystad Energy. The analysis also shows global storage infrastructure is in trouble and will be unable to take more crude and products in just a few months. Rystad liquid balances show supply surpassing oil demand by an average of nearly 6 million bpd in 2020, resulting in an accumulated implied storage build of 2.0 billion barrels this year. Based on our rigorous analysis, we find that the world currently has around 7.2 billion barrels crude and products in storage, including 1.3 billion to 1.4 billion barrels currently onboard oil tankers at sea. We estimate that, on average, 76% of the world’s oil storage capacity is already full. There is essentially no idle storage capacity available on tankers, as Saudi Arabia and other producers might have already wiped out the available population of Very Large Crude Carriers (VLCC) for March and April 2020. Namely, Rystad data shows that the theoretical available storage capacity at present is just 1.7 billion barrels onshore ...

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