IEA: 1991 WORLD OIL DEMAND TO RISE MODESTLY

World demand for oil this year will inch up to 65.9 million b/d, a 200,000 b/d increase from 1990. All the 1% increase will occur in countries outside the Organization for Economic Cooperation and Development, says the latest International Energy Agency forecast. Declines in consumption in the U.S.S.R. and non-OECD countries in Europe will be more than offset by increased demand elsewhere, mainly in Asia.

April 22, 1991

3 min read

World demand for oil this year will inch up to 65.9 million b/d, a 200,000 b/d increase from 1990.

All the 1% increase will occur in countries outside the Organization for Economic Cooperation and Development, says the latest International Energy Agency forecast.

Declines in consumption in the U.S.S.R. and non-OECD countries in Europe will be more than offset by increased demand elsewhere, mainly in Asia.

World demand last year was unchanged at 65.7 million b/d, while production averaged 66.6 million b/d. The balance was accounted for by a net increase in inventories held onshore and in floating storage.

IEA has expanded its supply/demand figures to include the former centrally planned economies for the first time. Previous IEA figures did not include CPE consumption. They covered only net exports from the bloc.

REGIONAL BREAKOUT

Demand among OECD members was unchanged at 37.5 million b/d last year. In the non-OECD area, where demand was also unchanged at 28.2 million b/d, declines in apparent demand in the U.S.S.R., non-OECD Europe, and China were off set by increases in Asia.

Worldwide demand in 1990 remained unchanged because of a 4.6% decline in OECD during the fourth quarter.

There were considerable regional variations in OECD demand. Pacific area demand, fueled by strong economic growth in Japan, was up 4.6%. Europe, hit by an economic slowdown and a warm winter, showed only a 1% increase.

In North America a 2.1% decline was reported, reflecting weakening economies in the U.S. and Canada, weather extremes, and higher oil prices.

Asia, where growth was 10% in 1988 and 1989, saw increases moderated to 9% last year. Fourth quarter Asian growth was down to 6%. Demand in 1991 is expected to increase by 7% to 5.7 million b/d.

In Latin America, demand was unchanged at 5.1 million b/d, and no growth is forecast for this year. African demand increased to 2.1 million b/d from 2 million b/d and is expected to remain at this new level throughout 1991.

Middle East demand rose an estimated 3-4% in 1989 and 1990 to 3.2 million b/d and is expected to advance to 3.3 million b/d this year. Part of the increase in 1990 stemmed from the military buildup by the allied coalition at the end of the year.

In the U.S.S.R., demand apparently slipped 5% to 8.4 million b/d last year, but the decline may have been exaggerated by an unusually mild winter. A further decline to 8 million b/d is expected this year as industrial production continues to fall.

Eastern Germany is still included in the non-OECD category on a temporary basis. Its oil demand is estimated to have fallen by about 8% to less than 1.9 million b/d last year, reflecting higher consumer prices, lower gross national product, foreign exchange constraints, and crude and products shortages. The trend is expected to continue in 1991.