ECONOMIC EXPANSION

WORLDWATCH VORACIOUS APPETITE FOR COMMODITY NEWS

 

Previous posts
Goodgle link units
Add your google link units or ad units here by replacing this text in the template
subscribe
Add ANY ICONS OR Blog directories buttons here
Blog Archieve
  • November 2006
  • August 2007
  • September 2007
  • October 2007
  • November 2007
  • December 2007
  • January 2008
  • February 2008
  • March 2008
  • April 2008
  • May 2008
  • June 2008
  • July 2008
  • August 2008
  • September 2008
  • October 2008
  • November 2008
  • December 2008
  • January 2009
  • February 2009
  • March 2009
  • April 2009
  • May 2009
  • June 2009
  • July 2009
  • August 2009
  • September 2009
  • October 2009
  • November 2009
  • December 2009
  • January 2010
  • February 2010
  • March 2010
  • April 2010
  • May 2010
  • June 2010
  • July 2010
  • August 2010
  • September 2010
  • October 2010
  • November 2010
  • December 2010
  • January 2011
  • February 2011
  • March 2011
  • April 2011
  • May 2011
  • June 2011
  • July 2011
  • August 2011
  • September 2011
  • October 2011
  • November 2011
  • December 2011
  • January 2012
  • February 2012
  • March 2012
  • April 2012
  • June 2012
  • July 2012
  • August 2012
  • September 2012
  • October 2012
  • December 2012
  • January 2013
  • February 2013
  • May 2013
  • August 2013
  • April 2014
  • June 2014
  • September 2014
  • October 2014
  • January 2015
  • February 2015
  • March 2015
  • April 2015
  • September 2015
  • November 2015
  • January 2016
  • March 2016
  • November 2016
  • January 2017
  • June 2017
  • Credits




    Oil stockpiles have swollen to a record of almost 3 billion barrels because of strong production in OPEC and elsewhere, potentially deepening the rout in prices, according to the International Energy Agency.
    This “massive cushion has inflated” on record supplies from Iraq, Russia and Saudi Arabia, even as world fuel demand grows at the fastest pace in five years, the agency said. Still, the IEA predicts that supplies outside the Organization of Petroleum Exporting Countries will decline next year by the most since 1992 as low crude prices take their toll on the U.S. shale oil industry.


    “Brimming crude oil stocks” offer “an unprecedented buffer against geopolitical shocks or unexpected supply disruptions,” the Paris-based agency said in its monthly market report. With supplies of winter fuels also plentiful, “oil-market bears may choose not to hibernate.”

    Crude has dropped about 40 percent in the past year as OPEC defends its market share against rivals such as the U.S. shale industry, which is faltering only gradually despite the price collapse. Oil inventories are growing because supply growth still outpaces demand, the 12-member exporters group said in its monthly report Thursday.
    Total oil inventories in developed nations increased by 13.8 million barrels to about 3 billion in September, a month when they typically decline, according to the agency. The pace of gains slowed to 1.6 million barrels a day in the third quarter, from 2.3 million a day in the second, although growth remained “significantly above the historical average.” There are signs the some fuel-storage depots in the eastern hemisphere have been filled to capacity, it said.

    Heating Fuel

    “The stock buffer is bearish and will probably set a lid on how much higher prices can go in 2016,” Torbjoern Kjus, an analyst at DNB ASA in Oslo, said by phone. “There’s a sizeable risk that we could run totally full,” in terms of storage capacity, he said.

    Stockpiles of diesel, used as heating fuel in Europe in the U.S. northeast, were at a five-year high of about 600 million barrels at the end of August. “This could protect the market from a supply crunch should there be a lengthy spell of cold temperatures,” the IEA said.

    Production outside OPEC will fall by 600,000 barrels a day next year, with an equal-sized decline in U.S. shale oil, the IEA said. That contrasts with an expansion of 2.4 million a day in 2014 in total non-OPEC output. The IEA’s 2016 forecast for non-OPEC supply, at 57.7 million barrels a day, is 100,000 barrels lower than in last month’s report.

    Demand Growth

    Overall, the report shows a stronger outlook for oil markets next year because of the cut to non-OPEC supply and increase in the demand forecast, according to DNB, RBC Capital Markets and Sanford C. Bernstein & Co.
    “While 2015 remains oversupplied, the picture for 2016 and beyond is becoming very favorable,” analysts at Bernstein including Oswald Clint said in a report.
    Faltering non-OPEC supply next year means that the amount of crude needed from OPEC is moving closer to the group’s actual output. About 31.3 million barrels a day will be required from the organization in 2016, 460,000 less than it pumped in October.

    Global Demand

    Supply from OPEC was little changed last month at 31.76 million barrels a day as declines in Iraq and Kuwait countered gains in Libya, Saudi Arabia and Nigeria, according to the report. Near-record output from the group’s Gulf members means the organization’s spare capacity is “stretched thin,” the IEA said. OPEC ministers will meet on Dec. 4 in Vienna to review their current policy.
    Global oil demand will climb by 1.8 million barrels a day this year to 94.6 million amid the strongest growth in India’s consumption in more than a decade, according to the agency. Demand growth will ease next year to 1.2 million barrels a day as the stimulus from cheap fuel fades and China’s economy remains “problematic.”

    written by ABSTRACTMIND @ 4:14 pm, ,


    Links

    Subscribe

    Subscribe in a reader

    Advertise


    The Commodity prices are provided by Forex Pros - The Leading Financial Portal

    blog links
    Finance directory