Shafaq News / Energy expert, Furat Al-Mousawi expected on Tuesday, that the prices of a barrel of oil will reach $ 60 at the end of current year.

"The improvement and stability of oil prices came as a result of the return of industrial life in China , the Asian countries and the agreement of the OPEC group," Moussawi told Shafaq News, noting that "next July will witness  an increase in demand for oil by countries and international companies."

"The statements of most industrialized countries about the necessity of returning to normalizing their lives due to the lack of an effective vaccine for Covid-19 and the economic life of these countries gradually has contributed also to high prices and may stabilize between 40-50 dollars."

"It is expected that the price of a barrel of oil would reach $ 60 at the end of this year, but this depends on the political and economic variables of the world,” Moussawi said.

It is noteworthy that the prices of a barrel of oil have decreased since the outbreak of Covid-19, which led to fears from the impact of the decline and lack of revenue on the budget of Iraq for 2020 that was affected by the operational budget , the salaries of government employees and retirees.

As a result, the Parliamentary Finance Committee estimated the deficit in the country's general budget for the current year at 69 trillion Iraqi dinars, describing it as an "unprecedented" deficit.

The Parliamentary Finance Committee revealed at mid of last May, Iraq’s lose of one billion and 350 million dollars for every dollar of low oil prices, while stressing its need for external loans to fill the reservation in the public budget.

Committee member , Jamal Kucher told Shafaq News that "the oil prices in the general budget of the Iraqi state were calculated at" $ 56 ", but that some of the lower prices may be calculated as" $ 30 "per barrel in 2020 budget."

Aviation crisis means oil demand to stay below pre-virus levels

Oil demand is recovering from the greatest fall in its history in 2020, the International Energy Agency (IEA) said on Tuesday, but less flying due to coronavirus fears means the world will not return to pre-pandemic demand levels before 2022.

“Our first forecast for 2021 as a whole shows demand growing by 5.7 million barrels per day (bpd), which, at 97.4 million bpd, will be 2.4 million bpd below the 2019 level,” the IEA said in its monthly report.

“Reduced jet and kerosene deliveries will impact total oil demand until at least 2022 ... the aviation industry is facing an existential crisis”, the Paris-based IEA said.

The IEA said air travel began to rise slightly in the middle of May and accelerated in June as economic lockdowns aimed at containing the virus were eased, but was still down by over 70% from 2019 levels.

The IEA raised its forecast for 2020 oil demand by nearly 500,000 bpd due to stronger than expected imports in Asia.

“China’s strong exit from lockdown measures has seen demand in April almost back to year-ago levels. We have also seen a strong rebound in India in May, although demand is still well below year-ago levels.”

Citing a plunge in global oil supply by 11.8 million bpd in May, the IEA said the Organization of the Petroleum Exporting Countries and its allies including Russia - a grouping known as OPEC+ - had reduced their output by 9.4 million bpd.

Output from countries outside the deal was down 4.5 million bpd since the start of this year, the IEA added, noting that U.S. output was set to fall 900,000 bpd in 2020 and another 300,000 barrels next year unless oil price rises encourage new shale oil investments.

“If recent trends in production are maintained and demand does recover, the market will be on a more stable footing by the end of the second half, the IEA said.

“However we should not underestimate the enormous uncertainties.”