Standard Chartered debunks theory of hidden oil reserves in China and South Africa

Standard Chartered has debunked the Wall Street theory gaining popularity about the existence of hidden oil reserves outside the Organization for Economic Cooperation and Development (OECD). In its recent commodity markets review, the firm confirmed the invalidity of information about secret stockpiling of energy resources in China and South Africa.

However, as noted by OilPrice columnist Charles Kennedy, this data contradicts the macroeconomic forecasts of market "bears." These forecasts claim that low oil inventories in OECD countries are masking an oversupply in other regions.

Nevertheless, the company's optimistic position is reinforced by OPEC+'s intention to cancel voluntary production cuts by alliance members. According to StanChart experts' expectations, the final production increase of 584,000 barrels per day on August 3 will mark the completion of the second phase of supply reduction cancellations. This decision speaks to OPEC's belief in the market's ability to absorb additional supply.

Meanwhile, activity in the US oil sector is declining. According to Baker Hughes data, the rig count has dropped for the 10th consecutive week to 425 units.