Oil Market Report - 2009 Archives

Highlights

Demand

• Global Oil Demand: Revised downward by 1.0 mb/d in 2009, projecting global oil demand at 85.3 mb/d (−0.6% or −0.5 mb/d year-on-year). The 2008 estimate was revised down by 70 kb/d to 85.8 mb/d (−0.3% or −0.3 mb/d versus 2007).
• 2008 and 2009 Forecast: The expected two-year contraction in oil demand would be the first since 1982 and 1983.

Supply

• Global Oil Supply: Flat in December at 86.2 mb/d, with curbed OPEC output offset by gains elsewhere.
• Non-OPEC Supply: Forecasted at 49.5 mb/d and 50.0 mb/d for 2008 and 2009 respectively, lowered by 60 kb/d and 30 kb/d versus last month’s report.
• 2008 Output: Declined by 150 kb/d, partly due to the first fall in Russian supply since 1996.
• 2009 Growth: Forecast at 0.5 mb/d, in addition to a 0.6 mb/d increment in OPEC NGLs.

OPEC Supply

• December OPEC Crude Supply: 30.9 mb/d, down 330 kb/d versus November.
• OPEC Target: New target of 24.8 mb/d from January, equivalent to OPEC-13 output of 28.2 mb/d versus a reduced 2009 ‘call’ of 29.5-30.0 mb/d.

Refinery Throughput

• 1Q09 Global Refinery Throughput: Forecast at 72.3 mb/d, 1.2 mb/d lower than last month’s report.
• Reasons: Weaker global demand and poor economics continue to hamper crude runs. Structural changes to the refining industry are also evident.

OECD Stocks

• End-November OECD Industry Stocks: Fell by 2.0 mb to 2,658 mb, as a US build was offset by lower European crude and Pacific distillates.
• End-November Forward Demand Cover: Remains high at 56.4 days on lower OECD demand.
• Preliminary December Data: Indicate an OECD draw of 8.0 mb.

Prices

• Crude Oil Prices: Rose to nearly $50/bbl in early January, supported by cold weather, the Russian/Ukrainian gas crisis, and fighting in Gaza.
• Subsequent Pressures: Weak global refinery demand and an increasing crude overhang have pressured Brent futures to currently around $45/bbl, while WTI was at $35/bbl, distorted by record-high Cushing stocks.