OPEC cuts oil demand forecast on weak economic news

By OGJ editors

With the outlook for economic growth in the US revised downward, the Organization of Petroleum Exporting Countries has cut its forecast for worldwide oil demand growth this year by 150,000 b/d.

In its latest Monthly Oil Market Report, OPEC forecasts global oil demand will increase by 1.21 million b/d this year to average 88.14 million b/d.

OPEC noted that economic worries along with high oil prices have affected oil demand in the advanced economies of the Organization for Economic Cooperation and Development (OECD), leading to weaker-than-expected consumption during the summer driving season. And oil demand in the OECD is expected to continue to contract after a temporary rebound last year.

In 2012, OPEC forecasts that world oil demand will rise by 1.3 million b/d, representing a slight downward revision from last month’s report.

World economic growth has been revised down to 3.7% in 2011 and to 4% in 2012. This was mainly due to revisions in the US forecast, which was cut to 1.8% from 2.5% in 2011 and to 2.3% from 2.9% in 2012.

Developing Asian countries continue to be the main drivers of growth, the report said. Forecasts for economic growth in China are unchanged at 9% for 2011 and 8.5% for 2012. India’s forecast for 2011 growth was trimmed to 7.9% from 8.1% but was unchanged at 7.7% for 2012.

Inventories

US commercial inventories climbed by 22.1 million bbl in July driven by products, which increased by 25.7 million bbl, as US crude stocks fell by 3.6 million bbl. With this build, US commercial oil inventories stood at 19.5 million bbl above the historical average.

By the end of July, crude in the US Strategic Petroleum Reserve declined by 6.8 million bbl to 719.8 million bbl due to the International Energy Agency-coordinated release of strategic reserves. In Japan, data for June showed that commercial oil inventories dropped by 4.5 million bbl, with crude and products showing a decline of 3.4 million bbl and 1.1 million bbl respectively. This put Japanese oil inventories 4.6 million bbl below the historical trend, OPEC said.

Other findings

This month’s reports shows that non-OPEC supply will increase by 580,000 b/d this year, following a downward revision, mainly due to lower-than-expected supply from Canada, Norway, UK, Malaysia, Vietnam, and Brazil, plus historical adjustments.

In 2012, non-OPEC oil supply is forecast to grow by 730,000 b/d to average 53.57 million b/d, unchanged from the previous report, due to projected increases in Brazil, Canada, Colombia, and the US.

OPEC natural gas liquids and unconventional oils are forecast to increase by 390,000 b/d in 2011 and 2012, also unchanged from the previous report.

Demand for OPEC crude in 2011 is estimated at 30 million b/d, unchanged from the previous assessment and up about 200,000 b/d from 2010. In 2012, demand for OPEC crude is forecast to average 30.2 million b/d, revised down by 100,000 b/d from the previous report.

Related Articles

Citing lower oil prices, Sasol delays Louisiana GTL plant investment

01/28/2015 South Africa’s Sasol Ltd. says it will delay the final investment decision on a large-scale, gas-to-liquids (GTL) plant in Louisiana as part of the...

ETP, Regency to merge in $18-billion deal

01/26/2015 Energy Transfer Partners LP (ETP) and Regency Energy Partners have agreed to merge in a unit-for-unit transaction, plus a one-time cash payment to ...

Capacity expansion planned for proposed Ohio GTL plant

01/26/2015 Ashtabula Energy LLC, Ashtabula, Ohio, a subsidiary of Velocys PLC, Houston, is seeking approval to build a grassroots gas-to-liquids plant that wo...

Kinder Morgan to acquire Hiland Partners for $3 billion

01/22/2015 Kinder Morgan Inc. (KMI) has agreed to acquire Hiland Partners from founder Harold Hamm and certain Hamm family trusts for $3 billion, including th...

Capacity expansion planned for proposed Ohio GTL plant

01/19/2015 Ashtabula Energy LLC, Ashtabula, Ohio, a subsidiary of Velocys PLC, Houston, is seeking approval to build a grassroots gas-to-liquids plant that wo...

Tall Oak expanding Oklahoma natural gas midstream

01/06/2015 Tall Oak Midstream, LLC began natural gas gathering operations on its 150-mile STACK System, serving producers in Oklahoma’s STACK play (Sooner Tre...

Room in storage

01/05/2015 Rapid growth of oil stocks-a physical manifestation of the surplus that began crushing crude prices in mid-2014-raises a question: How much empty s...

FERC approves Cheniere’s Corpus Christi Liquefaction project, pipeline

01/02/2015 The US Federal Energy Regulatory Commission has authorized Cheniere’s Corpus Christi Liquefaction LLC and Cheniere Corpus Christi Pipeline LP to co...

Cooper to buy 50% of offshore Gippsland Sole gas field

12/17/2014 Cooper Energy Ltd., Adelaide, has bought a 50% interest in the offshore Gippsland Sole dry gas field in retention lease Vic/RL3 as well as 50% of t...
White Papers

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...

Accurate Thermo-Fluid Simulation in Real Time Environments

The crux of any task undertaken in System Level Thermo-Fluid Analysis is striking a balance between ti...

6 ways for Energy, Chemical and Oil and Gas Companies to Avert the Impending Workforce Crisis

As many as half of the skilled workers in energy, chemical and oil & gas industries are quickly he...
Sponsored by
Available Webcasts

On Demand

Global LNG: Adjusting to New Realities

Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


US Midstream at a Crossroads

Fri, Mar 6, 2015

Oil & Gas Journal’s Mar. 6, 2015, webcast will focus on US midstream companies at an inflection point in their development in response to more than 6 years shale oil and gas production growth. Major infrastructure—gas plants, gathering systems, and takeaway pipelines—have been built. Major fractionation hubs have expanded. Given the radically changed pricing environment since mid-2014, where do processors go from here? What is the fate of large projects caught in mid-development? How to producers and processors cooperate to ensure a sustainable and profitable future? This event will serve to set the discussion table for the annual GPA Convention in San Antonio, Apr. 13-16, 2015.

This event is sponsored by Leidos Engineering.

register:WEBCAST


The Future of US Refining

Fri, Feb 6, 2015

Oil & Gas Journal’s Feb. 6, 2015, webcast will focus on the future of US refining as various forces this year conspire to pull the industry in different directions. Lower oil prices generally reduce feedstock costs, but they have also lowered refiners’ returns, as 2015 begins with refined products priced at lows not seen in years. If lower per-barrel crude prices dampen production of lighter crudes among shale plays, what will happen to refiners’ plans to export more barrels of lighter crudes? And as always, refiners will be affected by government regulations, particularly those that suppress demand, increase costs, or limit access to markets or supply.

register:WEBCAST


Oil & Gas Journal’s Forecast & Review/Worldwide Pipeline Construction 2015

Fri, Jan 30, 2015

The  Forecast & Review/Worldwide Pipeline Construction 2015 Webcast will address Oil & Gas Journal’s outlooks for the oil market and pipeline construction in a year of turbulence. Based on two annual special reports, the webcast will be presented by OGJ Editor Bob Tippee and OGJ Managing Editor-Technology Chris Smith.
The Forecast & Review portion of the webcast will identify forces underlying the collapse in crude oil prices and assess prospects for changes essential to recovery—all in the context of geopolitical pressures buffeting the market.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected