World oil demand growth of 1.2 million bpd is forecast in 2016, as first signs of a slowdown appear, according to the IEA Oil Market Report (OMR) for December.
The confirmation of the IEA outlook of the previous two OMRs comes as early indicators for the current quarter show growth easing to 1.3 million bpd from a year earlier, from a peak of 2.2 million bpd last quarter. The resulting annual growth of 1.8 million bpd for 2015 is led by China, the US, India and, somewhat surprisingly, Europe.
Slightly higher OPEC crude output accounted for the lion’s share of the 50 000 bpd increase in global oil supply in November, to inch up to a total of 96.9 million bpd, or 1.8 million bpd above a year earlier. Non-OPEC supply held at 58.5 million bpd in November, and annual growth slowed to below 300 000 bpd from 2.2 million bpd at the start of 2015.
OPEC crude output edged up to 31.73 million bpd as record production from Iraq and higher supply from Kuwait offset losses from African members. The OMR’s ‘call on OPEC crude and stock change’ for 2016 was unchanged from the November issue at 31.3 million bpd – a substantial rise of 1.6 million bpd on this year.
OECD commercial stocks drew for the first time in seven months in October to stand at 2971 million bbls at the end of the month. Global inventories are set to keep building at least until late 2016, but at a much slower pace than observed this year. New and spare storage capacity should be able to accommodate the projected extra 300 million bbls of stocks.
Global refinery runs rose by 1.4 million bpd in November to 79.9 million bpd as the maintenance season drew to a close. Margins in November remained healthy, though lower in the US, supported by gasoline and naphtha. Product cracks and margins, however, took a hit in early December.
Adapted from press release by Rosalie Starling
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