OPEC revises 2010 oil outlook
The Organization of Petroleum Exporting Countries, in its latest monthly Oil Market Report, expects worldwide oil demand to grow by 900,000 b/d in 2010.
OGJ Senior Editor-Economics
HOUSTON, Mar. 10 -- The Organization of Petroleum Exporting Countries, in its latest monthly Oil Market Report, expects worldwide oil demand to grow by 900,000 b/d in 2010. This is an upward revision of 100,000 b/d from OPEC’s previous assessment. In 2009, oil demand contracted by 1.4 million b/d.
Oil demand in member countries of the Organization for Economic Cooperation and Development this year is expected to decline by 150,000 b/d, while non-OECD demand is projected to grow by 1 million b/d, driven by China and the Middle East.
Oil demand has been highly dependent on the pace of the global economic recovery, OPEC said, and the forecast for worldwide economic growth sits at 3.4% for 2010, following a contraction of 0.9% in 2009.
“The global economy continues to be mostly supported by the governmental-led stimulus. Concerns remain regarding the level of public debt in almost all OECD regions, record-high unemployment levels across the globe, and the ability of China to avoid an overheating,” OPEC said.
Non-OPEC oil supply is projected to increase by 410,000 b/d this year to average 51.43 million b/d, compared to growth of 610,000 b/d in 2009. The 2010 figure represents a small upward adjustment from OPEC’s previous assessment, due to revisions to the estimates of processing gains as well as various historical data updates.
OPEC natural gas liquids and unconventional oils are expected to average 4.87 million b/d in 2010, an increase of 510,000 b/d over last year.
Demand for OPEC crude this year is expected to average 28.9 million b/d, around 200,000 b/d higher than in the previous assessment and a decline of 40,000 b/d from a year earlier.
Demand for OPEC crude in 2009 is estimated at 29 million b/d, which is 200,000 b/d higher than in the previous report. This is a decline of 2.2 million b/d from 2008.
Heading toward the lower-demand season, OPEC sees oil market weakness continuing in the second quarter of 2010 from the first quarter.
“Product demand will not be supportive of the market as the winter season is coming to an end. Weather-driven demand for middle distillates has dissipated, and there is little sign of an improvement in the diesel market. Additionally, with the continued rise in US gasoline stocks and surging ethanol volumes in the gasoline pool as well as ample idle refinery capacity, any seasonal upward movement in the gasoline market is likely to be limited,” OPEC said.
The outlook for fundamentals reflects the traditional weakness of the second quarter, according to the report. Even taking into account the uncertainty regarding demand for OPEC crude, current OPEC production is likely to exceed market needs.
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