Global demand growth is expected to slow from its five-year high of 1.8 MMb/d in 2015 to 1.2 MMb/d in 2016 – closer towards its long-term trend as previous price support is likely to wane, the IEA Oil Market Report for October informed subscribers. Recent downgrades to the macroeconomic outlook are also filtering through.
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| Image from Exxon. |
World oil supply held steady near 96.6 MMb/d in September, as lower non-OPEC production was offset by a slight increase in OPEC crude.
Non-OPEC accounted for just under 40% of the 1.8 MMb/d annual increase in total oil output. Lower oil prices and steep spending curbs are expected to cut non-OPEC output by nearly 0.5 MMb/d in 2016.
OPEC crude supply rose by 900,000 b/d in September to 31.72 MMb/d as record Iraqi output more than offset a dip in Saudi supply. A slowdown in forecast demand growth and slightly higher non-OPEC supply lowers the 2016 “call” on OPEC by 0.2 MMb/d from last month’s Oil Market Report to 31.1 MMb/d.
OECD commercial inventories extended recent gains and rose by 28.8 MMbbl in August to stand at 2 943 MMbbl by end-month. Since this was nearly double the 15.0 MMbbl five-year average build for the month, inventories’ surplus to average levels widened to 204 MMbbl.
The onset of seasonal turnarounds in the OECD and the Former Soviet Union is estimated to have curbed global refinery runs by 1.9 million b/d in September to 79.4 million b/d. Runs remained remarkably strong, particularly in Asia and the Middle East, leaving global throughputs up nearly 2 million b/d from a year ago.
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