Due to lower output from Iraq and Libya, crude oil supplies from the Organization of Petroleum Exporting Countries in September fell by 645,000 b/d to 29.99 million b/d, below the 30 million b/d threshold for the first time in almost 2 years, according to the International Energy Agency’s most recent Oil Market Report.
Non-OPEC supplies, after falling in August, inched up in September by 20,000 b/d to 54.61 million b/d, which is still significantly lower than July levels. As the steep fall in OPEC crude oil production only partially offset by the marginal increase in non-OPEC supplies, global oil supplies in September fell to 91.12 million b/d from 91.74 million b/d in August.
Signs of improvement in the European economy, coupled with higher-than-expected electric power sector use in other regions, raised the overall global oil demand forecast for 2013 by 90,000 b/d compared with last month’s report, to 91 million b/d, IEA said.
OECD industry oil stocks in August drew counterseasonally by 7.8 million bbl to 2,660 million bbl, driven by a steep 23.9 million bbl slide in crude oil. The August stock draw generated a 74.9 million bbl deficit of OECD stocks to its 5-year average levels. Measured in days of forward OECD demand, however, OECD stocks covered 58.6 days at end-August, 0.1 day above the 5-year average. OECD refined products built by a muted 16.6 million bbl to cover 31.1 days of forward OECD demand at end-August, 0.4 day above end-July.
Brent and WTI oil futures gradually eased by 6-7% over September and into early October. “Futures prices for Brent flirted near 6-month highs and WTI traded near a 30-month peak in the first week of September against a backdrop of supply outages and international alarm over Syria’s use of chemical weapons,” IEA said.
“Spot product crack spreads were mixed in September,” IEA added, “with gasoil and diesel posting modest strength in most regions ahead of the winter season.”
Global refinery crude throughput in September, although coming off their seasonal peak in August, remained 1.2 million b/d above year-earlier levels at an estimated 77.6 million b/d, with non-OECD Asia, the US, Russia, and Africa accounting for the bulk of the annual growth. From September onward, refinery crude demand would fell steeply due to seasonal maintenance and lower margins, according to IEA.
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