IEA oil market report Highlights
IEA estimated that the growth pace is slowed to 1.2 mb/d in 3Q17, reflecting relatively weak data during the months of July and August following the Hurricanes impact in the month of September. 2Q17 witnessed a very strong year-on-year demand growth. IEA forecasted the global demand remains unchanged at 1.6 mb/d in 2017 (or 1.6%) and 1.4 mb/d in 2018 ( or 1.4%).
2. Oil Supply
IEA reported that the global oil supplies rose 90 kb/d in september to 97.5 mb/d as against the fall of 720kb/d in Aug due to higher output by non-OPEC countries. OPEC output was virtually unchanged in Sep as slightly higher flows from Libya and Iraq offset lower supply from Venezuela. Output of 32.65 mb/d was down 400 kb/d on a year ago. The self declared supply cuts compliance rate was unchanged at 86% for the year-to-date.
3. Oil stocks
OECD commercial stocks fell 14.2 mb in August from an upwardly revised July. The surplus over the five-year average fell to 170 mb compared to a fall of 190 mb in July. 3Q17 likely to witness more inventory drawings as result of decreased floating storage and the OECD outweighed net builds in China.
4. Oil prices
Benchmark crude prices continued to rise in September month marking the third straight monthly gain. Crude futures rose by $2-4/bbl in September month against the rise of $1-3/bbl in August. Middle distillate prices increased twice as fast as crude, reflecting lower refinery throughputs and higher demand.
5. Oil Refinery operations
IEA’s refinery throughput forecast for 4Q17 edges up to 80.9 mb/d up 0.1 mb/d quarter- on - quarter as refineries will respond to higher margins in the tight product markets. IEA says that January 2018 is expected to see a growth of 1.2 mb/d year-on-year, although runs decline by 0.4 mb/d from December to just under 82mb/d.
IEA says that the crude and product markets look broadly balanced, assuming OPEC holds output steady at around current levels. IEA’s global crude and product balances are showing inventories drawings in 2017 by 0.1mb/d and 0.2 mb/d, respectively.
Taglines: world oil demand, opec crude oil supply, world oil supply, marker crude prices, marker crude spreads, non-OECD countrries,opec coouput, non-opec output, oecd industry, global oil stocks, global oil supply, bench mark crude prices,
By Srinivas Chowdary Sunkara / 12-10-2017