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Oil Market Report

mb/dWorld Oil Demand1Q20122Q20123Q20124Q20121Q20132Q20133Q20134Q20131Q20142Q20143Q20144Q20141Q20152Q20153Q20154Q2015868890929496© OECD/IEA 2014 World Oil Demand *Please note that these Highlights are from the latest Oil Market Report, which is released in full to subscribers only – according to this schedule each month . Non subscribers get free access to the latest Highlights on this schedule, however the full Oil Market Report is released to the public two weeks after the report is released to subscribers. If you would like to receive the full report with accompanying charts and graphs on the day of publication please subscribe or contact the subscription manager . The price of oil continued to collapse into January as rising supplies collided with weak demand growth and OPEC maintained its commitment to not cut production. Brent crude futures last traded at $48.40/bbl, near a six-year low. NYMEX WTI was at $47.75/bbl. Macroeconomic weakness continues to restrain global oil demand growth, with 4Q14 deliveries estimated […]

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IEA Sees Oil-Price Recovery; Cuts 2015 Non-OPEC Output Estimate

Non-OPEC oil producers will increase output this year at a slower rate than previously forecast, aiding a recovery in crude prices, the International Energy Agency said. The adviser lowered its non-OPEC supply growth estimate by 350,000 barrels a day, the first cut since the 2015 forecast was introduced in July. Half the cut is from Colombian output while effects on U.S. production are so far “marginal,” it said. The slow-down in non-OPEC output will lead to a “rebalancing” of currently over-supplied global markets in the second half, reviving prices, the agency said. “Companies have been taking an axe to their budgets, postponing or cancelling new projects,” the Paris-based IEA, which advises 29 nations on energy policy , said in its monthly market report. “A price recovery, barring any major disruption, may not be imminent, but signs are mounting that the tide will turn.” Oil prices have collapsed almost 60 […]

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Oil Producers Betting on Price Drop With OPEC Not Curbing Output

A visitor passes oil barrels stored at the Emirates National Oil Co. lubricants and… Read More The oil industry was listening as OPEC talked down crude prices to a more than five-year low. Drillers, refiners and other merchants increased bets on lower prices to the most in three years in the week ended Jan. 6, government data show. Producers idled the most rigs since 1991, with some paying to break leases on drilling equipment. Companies are hedging more and drilling less amid concern that the biggest slump in prices since 2008 will continue. Oil dropped for a seventh week after officials from Saudi Arabia , the United Arab Emirates and Kuwait reiterated they won’t curb output to halt the decline. “Producers are desperately hedging their production in a drastically falling market,” Phil Flynn , a senior market analyst at the Price Futures Group in Chicago , said by phone […]

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How OPEC Weaponized the Price of Oil Against U.S. Drillers

If there ever was doubt about the strategy of the Organization of Petroleum Exporting Countries, its wealthiest members are putting that issue to rest. Representatives of Saudi Arabia, the United Arab Emirates and Kuwait stressed a dozen times in the past six weeks that the group won’t curb output to halt the biggest drop in crude since 2008. Qatar’s estimate for the global oversupply is among the biggest of any producing country. These countries actually want — and are achieving — further price declines as part of an attempt to hasten cutbacks by U.S. shale drillers, according to Barclays Plc and Commerzbank AG. Crude fell 48 percent last year and has declined 35 percent since OPEC affirmed its output target on Nov. 27. That decision, while squeezing revenues for OPEC members in 2015, aims at preserving their market share for years to come. “The faster you bring the price […]

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High Noon on the Gulf Coast: Canada, Saudi oil set for showdown

NEW YORK (Reuters) – As a test of wills between OPEC nations and U.S. shale drillers fuels a global oil market slump, a brewing battle between Canadian and Saudi Arabia heavy crudes for America’s Gulf Coast refinery market threatens to drive prices even lower. While the stand-off between the oil cartel and U.S. producers of light, sweet shale oil has captured the limelight in recent months, the clash over heavier grades – playing out in the shadowy, opaque physical market – may put even more pressure on global prices that have halved since mid-2014. Two factors will come into play over the next few weeks: From the North, new oil pipelines will pump record volumes of Canadian crude to the southern refineries, many better equipped to process heavy crudes than lighter shale oil. From the Middle East, top exporter Saudi Arabia is offering crude at discounted prices in an […]

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Guest blog: Scrap “The Call on OPEC”

Steven Kopits is the President of Princeton Energy Advisors, and has been a guest blogger on The Barrel numerous times in the past.  Seven years ago, when I first turned my attention full time to oil, one of the strangest concepts I encountered was the “call on OPEC”. The call on OPEC means different things in different contexts, but fundamentally, it is as non-economic and culturally imperialist a term as one could imagine. The call of OPEC works like this. Non-OPEC countries are assumed to produce as much as they can, guided essentially by price signals. Whatever demand is left over can be served by OPEC. OPEC is thus assumed to “balance the market” and the number of barrels necessary to do so is the “call on OPEC.” Now, imagine this concept grafted onto, say, automobile production. Suppose an American policy-maker argued that GM and Ford should produce as many cars as they […]

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OPEC Resolve on Supply Promises No Calm for Oil Markets: Energy

Oil’s biggest price swings in three years are poised to continue as OPEC cedes no ground to competing suppliers. Oil traders’ expectations for future swings, known as implied volatility, surged since Saudi Arabia and fellow members of the Organization of Petroleum Exporting Countries decided on Nov. 27 to keep pumping crude despite a supply glut. That will mean prices fluctuating in the next several years by even more than the $58-a-barrel move in 2014, Bank of America Corp. says. “OPEC has always been there to lower volatility both on the upside and downside, but now they have less and less weight,” said Pierre Andurand , the London-based founder of Andurand Capital Management LLP, whose $350 million fund earned 18 percent in November from betting on lower Brent crude prices. “It means more volatility.” OPEC’s policy of testing rival producers’ tolerance for lower prices has sparked the search for a […]

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U.S. Opening Door to More Oil Exports Seen Foiling OPEC Strategy

The Obama administration’s move to allow exports of ultralight crude without government approval may encourage shale drilling and thwart Saudi Arabia’s strategy to curb U.S. output, further weakening oil markets, according to Citigroup Inc. A type of crude known as condensate can be exported if it is run through a distillation tower, which separates the hydrocarbons that make up the oil, according to U.S. government guidelines published yesterday. That may boost supplies ready to be sold overseas to as much as 1 million barrels a day by the end of 2015, Citigroup analysts led by Ed Morse in New York said in an e-mailed report. Saudi Arabia led the Organization of Petroleum Exporting Countries to maintain its production quota at a meeting last month even as a shale boom boosted U.S. output to the highest in more than three decades. That prompted speculation OPEC was willing to let prices […]

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Non-OPEC Producers Called on to Cut Oil Output After Rout

Oil producers outside of OPEC should cut their “irresponsible” output with excess supplies harming the market, the United Arab Emirates energy minister said. The oil market is oversupplied by 2 million barrels a day, Mohammed Al Sada, Qatar’s energy minister, said in an interview on the sidelines of a conference in Abu Dhabi yesterday. The Organization of Petroleum Exporting Countries has produced about 30 million barrels a day since January 2013 while global output climbed more than 2 million barrels a day to 93.6 million barrels, according to data compiled by Bloomberg. “We call on all other producers to stop the increase because the increase is harming the market,” U.A.E. Energy Minister Suhail Al Mazrouei said in a separate interview at the conference. “If the increase stops, and they follow OPEC’s lead, OPEC’s decision is to fix production, if production stabilizes in 2015 things will stabilize much faster.” Brent […]

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Oil prices land blow to OPEC, EIA says

Traders dredge the depths as oil markets continue to search for the bottom. U.S. agency warns OPEC members may start feeling the pain. UPI/John Angelillo NEW YORK, Dec. 17 (UPI) — The U.S. Energy Information Administration warned OPEC members might need to trim their budgets as oil prices continued their steady decline Wednesday. "Further revisions to future budget plans may be required in many OPEC member countries, particularly [Venezuela, Iraq and Ecuador], because of lower oil prices and large uncertainty over future global economic growth and crude oil production levels," EIA said in a brief Wednesday. Brent, the global oil price index, continued dropping in early trading Wednesday, down nearly $1 per barrel to $59.16 for the January contract. Brent prices this week fell below the $60 mark for the first time in more than five years. A November decision by the Organization of Petroleum Exporting Countries to keep […]

Posted On : Published By : Tom Whipple