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- Create Date April 27, 2021
- Last Updated April 27, 2021
During 2020, from as early as February and March, petroleum prices accelerated their decline in reaction to the COVID-19 pandemic coupled with an expected sharp drop in demand for oil.
In addition, major oil producers failed to come to an agreement on production cuts, exacerbating the problem and by mid-March 2020, the price of US crude oil was fluctuating around $19 per barrel. OPEC members and non-OPEC oil producing countries who participated in the Declaration of Cooperation agreed to fully implement the agreements reached at the 9th and 10th (Extraordinary) OPEC and NON-OPEC Ministerial Meetings held on April 9th and 12th, 2020 respectively. These agreements became effective as of 1st May, 2020.
In its monthly report, the Organization of the Petroleum Exporting Countries (OPEC) forecasted that demand for the group’s oil will remain around 27.93 million barrels per day (b/d) in 2021, on the back of slower economic growth projections.
The Organisation for Economic Cooperation and Development (OECD) forecasted demand for 2021 is 44.39 mn b/d while non-OECD demand is expected to average 53.38 mn b/d. On the supply side, the Energy Information Administration of the US Department of Energy expects world production to increase to 97.13 mn b/d during 2021 above the 94.23 mn b/d level for 2020.
Given the volatility associated with the Energy Sector locally, regionally and internationally, the Ministry will continue its focus on its 2030 greening vision in an effort to negate these international market dynamics.
With the onset of COVID-19, Barbados’ key sector tourism was dealt a serious blow due to significant decline in our key markets. Indeed, electricity demand fell by 5 % to 893 Gwh in 2020 when compared to the 943 Gwh observed in 2019. To this end, the Government has taken this opportunity to accelerate and bring forward investments in the renewable energy subsector to help Barbados’ economic recovery post COVID-19.