IEA oil report for October 2009, the highlights

IEA oil report for October 2009, the highlights:

Global oil demand has been revised up by 200 kb/d for 2009 and by 350 kb/d for 2010, given more optimistic IMF economic prognoses and stronger preliminary data from the Americas and Asia. Global oil demand now averages 84.6 mb/d in 2009 and 86.1 mb/d in 2010, implying yearly growth of -1.7 mb/d and +1.4 mb/d, respectively.

Crude oil prices in September continued to trade in a $65-75/bbl range, although high distillate stocks ahead of winter and worries about the global economic recovery added a downward bias, with WTI and Brent trading at around $68-72/bbl in early October. Market concerns over Iran’s nuclear programme have been muted, partly because OPEC’s spare production capacity currently exceeds 5.4 mb/d.

OECD industry stocks decreased by 3.9 mb in August to 2,750 mb, 2.8% above last year’s level. Crude draws in North America and the Pacific outweighed middle distillate increases in all three regions. End-August forward demand cover decreased to 60.7 days, 3.7 days higher than a year ago.

Global oil supply rose by 310 kb/d in September to 84.9 mb/d, driven by non-OPEC growth. Compared with September 2008, global supply was nearly flat, as a non-OPEC recovery of 1.6 mb/d relative to last year’s hurricane-hit base was offset by OPEC curbs. That said, OPEC supply has continued to rise from early 2009 lows.

Non-OPEC output projections are left largely unchanged, and production should continue to rise towards the end of 2009. Output is expected to average 51.0 mb/d this year, rising to 51.6 mb/d next year. Total annual growth stands at +380 kb/d in 2009 and +550 kb/d in 2010, augmented by OPEC NGL growth of 550 kb/d and 850 kb/d, respectively.

Global refinery crude throughput in 4Q09 is reduced by 0.2 mb/d to 73.2 mb/d, as further weakness in refining margins undermines the outlook. Declines in OECD Europe and North America compound lower Latin American projections, only partially offset by higher Other Asian estimates resulting from stronger 3Q09 data.

Tags:  IEA oil report, October