Hydrocarbon Processing Copying and distributing are prohibited without permission of the publisher
Email a friend
  • Please enter a maximum of 5 recipients. Use ; to separate more than one email address.



OPEC says Asian growth offsets low OECD demand

03.09.2012  | 

The fundamental forces driving the world oil market were broadly stable in February, due to the familiar pattern of consumption growth in Asia offsetting weaker demand in the West, the Organization of Petroleum Exporting Countries said Friday. Recent data hasn't been encouraging, it said.

Keywords:

By JAMES HERRON

The fundamental forces driving the world oil market were broadly stable in February, due to the familiar pattern of consumption growth in Asia offsetting weaker demand in the West, the Organization of Petroleum Exporting Countries said Friday.

This apparent stability belies political tensions between Iran and the West, over the country's nuclear program, which pushed the average OPEC oil price to a three-year high late in February.

Indeed, the bullish effect of the Iranian standoff is undercut by the negative oil price effect of continued weakening demand in Europe and the US, OPEC said in its monthly oil market report.

OPEC left its headline forecasts broadly unchanged from the previous month. It continues to see global oil demand growing by 900,000 bpd in 2012 and says the world's need for its crude oil is stable at 30 million bpd.

This is equal to the exporter group's official production ceiling, but 970,000 bpd below its February output.

As usual, OPEC shied away from discussing the Iranian situation and instead highlighted economic weakness in Europe as the main uncertainty in the oil market.

Recent data hasn't been encouraging, it said.

"US oil consumption data for December showed a 4.6% year-on-year contraction, the worst observed since July 2009," OPEC said. "Preliminary weekly data for January and February 2012 has displayed similar contractions."

Western Europe's oil demand declined in January and looks likely to keep falling in coming months, it said. OPEC predicts a contraction of 1.7%, or 240,000 bpd, in Western Europe's oil demand in 2012.

Offsetting this is consumption growth in Asia, driven largely by extra demand in Japan, which shut down almost all of its nuclear reactors following the Fukushima meltdown a year ago.

China also boosted its demand in January by adding 800,000 bpd of crude oil and refined products to its commercial and strategic storage, OPEC estimated.

Some analysts have speculated that China could absorb into these strategic stores much of the 600,000 bpd of Iranian oil imports Europe will ban from July.

Chinese imports of Iranian oil fell by 90,000 bpd in January, adding to a 40,000 bpd decline from November to December, the report said.


Dow Jones Newswires



Have your say
  • All comments are subject to editorial review.
    All fields are compulsory.

Related articles

FEATURED EVENT


Sign-up for the Free Daily HP Enewsletter!

Boxscore Database

A searchable database of project activity in the global hydrocarbon processing industry

Poll

Should the US allow exports of crude oil? (At present, US companies can export refined products derived from crude but not the raw crude itself.)


64%

36%




View previous results

Popular Searches

Please read our Term and Conditions and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.
© 2014 Hydrocarbon Processing. © 2014 Gulf Publishing Company.