• Benchmark crudes approached seven-year lows in early December after OPEC opted to continue producing at will to defend market share. Unrelenting oversupply in world markets had already weakened benchmarks during November. ICE Brent was last trading at $39.77 /bbl with NYMEX WTI several dollars lower at $36.87/bbl.
  • World demand growth of 1.2 mb/d is forecast in 2016, as first signs of a slowdown appear. Early indicators for 4Q15 show growth easing to 1.3 mb/d y-o-y, from a 3Q15 peak of 2.2 mb/d. The resulting annual growth of 1.8 mb/d for 2015 is led by China, the US, India and – somewhat surprisingly – Europe.
  • Global oil supply inched up 50 kb/d in November to 96.9 mb/d on slightly higher OPEC crude output. Total supplies stood 1.8 mb/d above a year ago, with OPEC accounting for the lion’s share. Non-OPEC supply held at 58.5 mb/d in November, but annual growth slowed to below 300 kb/d from 2.2 mb/d at the start of 2015.
  • OPEC crude output edged 50 kb/d higher in November to 31.73 mb/d. Record production from Iraq and higher supply from Kuwait offset losses from African members. The ‘call on OPEC crude and stock change’ for 2016 is unchanged from our previous Report at 31.3 mb/d – a substantial rise of 1.6 mb/d on this year.
  • OECD commercial stocks drew for the first time in seven months in October to stand at 2 971 mb at end-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 mb of stocks.
  • Global refinery runs rose by 1.4 mb/d in November to 79.9 mb/d as the maintenance season drew to a close. Margins in November remained healthy, though lower in the US, but higher elsewhere, and still supported by gasoline and naphtha. Product cracks and margins, however, took a hit early December.
Posted in: IEA