International Energy Agency| Oil Market Report for January 2014

Strong US deliveries lift global oil demand; OECD commercial inventories shrink

 

Unexpectedly strong deliveries in the United States lifted global oil demand for the final quarter of last year by 135 000 barrels per day (135 kb/d) higher than originally forecast, the IEA Oil Market Report (OMR) for January estimated. Curtailments in China and elsewhere partly offset the US increase, but the closing surge left growth for all of 2013 at about 1.2 million barrels per day (mb/d), which the monthly report expects to accelerate to 1.3 mb/d in 2014 as the economy continues to recover.

Global supplies eased 25 kb/d in December from the previous month, to 92.23 mb/d,
as a seasonal decline in biofuel output cut non‐OPEC liquids supplies by 340 kb/d. Non‐OPEC production grew by 1.63 mb/d from December 2012. Year-on-year OPEC crude oil supply fell 535 kb/d in December, but it rebounded by 310 kb/d from the previous month, to 29.82 mb/d, reversing four months of decline. Saudi Arabia and the United Arab Emirates led the gain. Iraq was the only member to post a decline, though beleaguered Libya saw only a modest rise, amid government expectations of an imminent recovery in oil output.

The OMR raised its forecast of global refinery crude for the current quarter by 110 kb/d from the December report, to 76.8 mb/d, on the back of surging US crude runs. Global throughput in the quarter should grow 1.3 mb/d, up from only 0.3 mb/d in the last quarter of 2013, as contractions in Europe ease and new Chinese and Middle Eastern capacity ramps up.

Total OECD commercial oil inventories plummeted by 53.6 mb in November, their steepest monthly decline since December 2011, led by a plunge in crude oil and the OMR’s “other products” category. Preliminary data for December indicate a further 42.5 mb draw on OECD inventories.