Sharpest drop in European demand since 1985 contributes to forecast of a third straight year of weak growth in global consumption
11 April 2013
The International Energy Agency expects 2013 to be the third consecutive year of weak growth in demand, adding only 795 000 barrels per day (795 kb/d), according to the April Oil Market Report (OMR) published today.
Relatively strong demand growth among non-OECD countries of 1.28 million barrels a day (mb/d) will be tempered by a contraction of 480 kb/d in OECD consumption, particularly in Europe, where it will shrink by 340 kb/d. European demand has not been this weak since 1985.
The April OMR’s estimate of total global demand for the year remains broadly unchanged from the March report’s 90.6 mb/d.
The weight of renewed pessimism for the global economic outlook led to a decline in oil futures prices in March. Weaker demand for crude oil, amid exceptionally deep seasonal maintenance at refineries, added to the pressure.
The OMR estimates that non-OPEC oil supply output for the quarter averaged 54 mb/d, a gain of 650 kb/d from the first quarter of 2012. Overall for 2013, non-OPEC supplies are expected to grow by 1.1 mb/d to 54.4 mb/d as South Sudan resumes exports, other disruptions abate and North American growth continues. OPEC crude oil supply turned lower in March, falling 140 kb/d to 30.44 mb/d, in the wake of disruptions in Nigeria, Libya and Iraq and against a backdrop of seasonally weaker second-quarter refiner demand.
OECD industry oil stocks were reduced by a seasonal 32.9 mb to stand at 2 664 mb by end-February. But stocks have remained at a surplus to five-year average levels for the sixth consecutive month.
Refinery crude throughput will remain subdued in the second quarter, the OMR notes, because of spring maintenance in Europe, Asia, the former Soviet Union and the Middle East.
The Oil Market Report (OMR) is a monthly International Energy Agency publication which provides a view of the state of the international oil market and projections for oil supply and demand 12-18 months ahead. To subscribe, click here.
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