Demand for OPEC crude is expected to drop 0.3% to 29.6 mb/d in 2014: MOMR

WAM Vienna, 11Oct. 2013 (WAM) — Demand for OPEC crude in 2013 is estimated to average 29.9 mb/d, representing a decline of 0.5 mb/d from 2012. In 2014, demand for OPEC crude is expected at 29.6 mb/d, representing a decline of 0.3 mb/d compared to the current year,according to OPEC’s Monthly Oil Market Report (MOMR).

The report said OPEC Reference Basket rose for the fourth consecutive month in September, increasing by $1.21/b to average $108.73/b. Crude oil futures prices began the month with some upward momentum fuelled by supply outages and a spike in geopolitical tensions. However, with the easing of geopolitical concerns, oil prices on both sides of the Atlantic began to drop steadily, shedding some $8/b. An improvement in supply prospects from the MENA region and Sudan, along with assurances by major suppliers and international oil agencies that the market was well-supplied, also dampened the upward pressure on crude oil prices. As the rally in the crude futures market came to end, money managers sharply reduced their record-high net length positions at the end of September.

As for non-OPEC oil supply, the report estimated it at 54.1 mb/d, following an upward revision of 0.1 mb/d, representing growth of 1.1 mb/d. The upward adjustment was due mainly to higher-than-expected supply from the US, Brazil, Kazakhstan and South Sudan and Sudan.

”In 2014, non-OPEC oil supply is expected to increase by 1.2 mb/d, supported by anticipated growth in the US, Canada, Brazil, and South Sudan and Sudan. OPEC NGLs and nonconventional oils are expected to increase by 0.2 mb/d in 2013 and 0.1 mb/d in 2014. In September, total OPEC crude production averaged 30.05 mb/d, according to secondary sources, representing a drop of 390 tb/d from the previous month,” the report added.

”Total OECD commercial oil stocks fell by 10.0 mb in August to show a deficit of around 68 mb with the five-year average, divided between crude and products. In terms of forward cover, OECD commercial stocks stood at 58.6 days, a surplus of 0.1 days compared to the five-year average. Preliminary data for September shows US commercial oil stocks rose 4.5 mb – reversing the drop of last two months – to indicate a surplus of 33.0 mb with the five-year average. This gain was divided between crude and products, which indicated surpluses of 23.7 mb and 9.2 mb, respectively.” WAM/TF

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