Liam Denning, Columnist

OPEC Previews Saudi Aramco's IPO Prospectus

Its dour outlook helps explain why investors need enticements.

November 5, 2019 at 3:45 PM UTC

Liam Denning is a Bloomberg Opinion columnist covering energy. A former banker, he edited the Wall Street Journal’s Heard on the Street column and wrote the Financial Times’s Lex column.

OPEC opens a window onto Saudi Aramco’s IPO.
Photographer: AFP/Getty Images

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Saudi Aramco’s no-doubt-hefty IPO prospectus isn’t due out for several days yet. But OPEC’s own annual tome, the World Oil Outlook, dropped Tuesday — and it reads like an essential preamble.

The oil exporters’ club remains optimistic about long-term prospects for its favorite fuel and its own fortunes. The medium-term outlook borders on despair. Total liquids supply from the group — including crude oil, natural gas liquids and others — is expected to fall by 2.2 million barrels a day through 2023, to just 32.7 million barrels a day. Comparisons with previous estimates are complicated by Qatar having left OPEC this year. Still, even adjusting for that,2 this year’s projection for OPEC’s output in 2023 is about 3.9 million million barrels below what was anticipated this time last year, equivalent to wiping out the United Arab Emirates’ current production. This accelerates a trend in OPEC’s estimates for its own supply in recent years.