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Page added on May 17, 2014
Opec oil supply could fall short of meeting global demand this year
FT: Opec “will need to increase production significantly in the second half of the year in order to meet world demand, according to the west’s energy watchdog.”
“While production gains of about 400,000 barrels a day in April have gone some way towards easing tight global markets, the International Energy Agency says a bigger increase will be needed in the second half of the year when consumption picks up after the northern hemisphere summer.
“In order to balance forecast demand, Opec countries would need to hike third quarter production by another 900,000 b/d from April levels,” the agency said in its latest monthly report.
But the Paris-based organisation said it was not clear if Opec, which controls about a third of world oil production, would be able ….A series of problems have hampered crude supply from Opec members.
….As a result of these problems, the IEA has cut its estimate for non-Opec supply growth by 100,000 b/d to 1.5m b/d.
Brent, the international oil maker, has traded in a narrow range this year, averaging $108 a barrel as the diplomatic crisis over Ukraine and continued disruptions to Opec and non-Opec supplies have offset slowing growth in emerging markets such as China.
The IEA said a surge in China imports in April, which was not matched by a commensurate rise in demand, suggested the world’s second-biggest oil consumer was adding to its strategic reserves. It said the stockpiling could provide a further prop to prices and tighten global oil stocks.
….Analysts expect China to add more than 40m barrels to its strategic oil reserves in the first half of 2014.”
3 Comments on "Opec oil supply could fall short of meeting global demand this year"
Northwest Resident on Sat, 17th May 2014 11:02 am
Jeremy Leggett is just trying to bolster his often stated point of view that world oil shortages could strike as soon as 2015. To back up his claims, Jeremy shamelessly lists uncomfortable facts that most people don’t want to hear or deal with. He enlists ranking members of the US Military who are concerned with national security to support his claims that we are going to experience global oil shortages in the near-term future. In summary, it seems that Jeremy will stop at nothing to inform anybody who is listening that we are heading for frigging disaster next year, or maybe the year after, but sooner rather than later. The nerve of this guy! Why can’t he just let people sleep-walk off the cliff instead of trying to slap them into consciousness with all these facts and logical arguments? jeez…
Beery on Sat, 17th May 2014 12:03 pm
I agree with Northwest Resident. The nerve of this Leggett character. What we need right now is avoidance, apathy and pig ignorance, not some sort of altruistic whistle-blower intent on delivering the facts. I mean, where will that kind of thing end?
rockman on Sat, 17th May 2014 8:32 pm
“…adding to its strategic reserves. It said the stockpiling could provide a further prop to prices and tighten global oil stocks. Analysts expect China to add more than 40m barrels to its strategic oil reserves in the first half of 2014.”
That amount of oil going into permanent storage represents about 0.25% of the current global oil production. IMHO I don’t think the Chinese SPR fill alone will impact prices very much.
And as far as: “In order to balance forecast demand, Opec countries would need to hike third quarter production by another 900,000 b/d from April levels”. Or just simply let the price of oil rise which would also “balance forecast demand”. Higher oil prices decrease demand and SHAZAM!!!…supply and demand equalizes.