THE mining sector is expected to rebound by 4.1% in 2021, supported by the recovery in global demand for crude oil and condensate as well as liquefied natural gas (LNG), said the Finance Ministry (MoF).
It said Brent crude oil price is expected to improve next year to an average of US$42 per barrel and recover to pre-pandemic level in the medium term.
However, the mining sector witnessed a double-digit contraction of 11% in the first half of 2020, affected by the slump in global demand due to business closures as well as the reduction in travel and transport activities.
“The sector was further weighed down by the temporary shutdowns of several oil and gas facilities for maintenance purpose,” MoF said in its Economic Outlook 2021 report released today.
The ministry noted that with the COVID-19 pandemic crushing demand, storage facilities filled rapidly, and Brent crude fell to its lowest level at US$17.32 per barrel on April 21 before stabilising at about US$40 per barrel.
Meanwhile, the sector is expected to continue to decline in the second half of the year due to on-going maintenance works and bearish outlook, following economic and geopolitical uncertainties as well as trade tension.
“Against this backdrop, the mining sector is anticipated to contract by 7.8% in 2020,” it added. – Nov 6, 2020