OPEC Seen Unyielding in Oil Market-Share Battle with Shale

U.S. oil producers idled more than half of the country’s drilling rigs since October, according to data from Baker Hughes Inc. The nation’s crude production fell 1.2 percent to 9.3 million barrels a day last week, the biggest drop since July, Energy Information Administration data show.

Global investment in oil production might fall by $100 billion this year, according to the IEA.

Demand growth will accelerate to 1.3 million to 1.4 million barrels a day this year, Chris Bake, an executive director at Vitol Group, the world’s largest independent oil trader, said at a conference in London on May 20. Lower prices and economic growth increased demand in Europe, the Middle East and India, he said. Global oil demand rose 700,000 barrels a day last year, according to the IEA.

“OPEC doesn’t really have a need to change course,” Francisco Blanch, Bank of America Corp.’s head of commodities research, said by phone from New York on May 18. “The strategy has achieved its goal of reining in supply and stimulating demand.”

--With assistance from Heesu Lee in Seoul, Ben Sharples in Melbourne, Jing Yang in Shanghai, Sarah Chen in Beijing, Mark Shenk in New York and Angelina Rascouet in London.

To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net. To contact the editors responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net James Herron, Rachel Graham