Share
Oil producers’ group Opec made a further revision to its world oil demand outlook for 2011, as did the Paris-based International Energy Agency (IEA).In its monthly oil market report, Opec forecast global oil demand growth for 2011 at 1.06 million barrels a day (b/d), down 150,000 b/d on the previous forecast.
The downward revision is concentrated in OECD countries, says Opec with the US and Europe dropping 120,000 b/d on the back of a weaker-than-expected driving season in the US and sluggish economic performance in Europe.
The sentiment was matched by the IEA, in its 13 September Oil Market Report, which cut global oil demand growth for 2011 by 160,000 b/d to 1.04 million b/d for the same broad reasons.
Both agencies were more optimistic on supply from Libya however. The IEA lifted its fourth quarter Libya supply forecast by 100,000 b/d to average between 350,000- 400,000 b/d by the end of 2011. This could rise to 1.1 million b/d by the end of 2012. Opec sees production hitting 1 million b/d within the next six months.
Libya’s National Transitional Council (NTC) resumed oil production in the eastern region on 12 September. Small volumes were sent from the Messla field flowing to facilities at the larger Sarir field, where it is sent on to the port of Tobruk.Benghazi-based Arabian Gulf Oil Company (Agoco) Abduljalil Mayuf told Reuters the current flow rate was approximately 50,000 barrels a day (b/d). Exports are expected to start flowing by the end of the week.
US benchmark West Texas Intermediate (WTI) prices ended at $88.91 a barrel on 14 September, while Europe’s Brent crude continues to trade at a significant premium, hitting $111.84 a barrel.
The WTI-Brent spread reached a record high last week.“The market for WTI has dislocated further away from the world market and, in our view, has now dislocated from the fundamentals of the US Midwest market as well”, say analysts at the UK’s Barclays Capital.
“We are beginning to lose interest in the dynamics of WTI, given that its relevance as an indicator for the vast majority of producers and consumers has been curtailed severely”.
Have your say
You must sign in to make a comment.