Opec supply has highest monthly increase in four years
Organisation of the Petroleum Exporting Companies (Opec) reached a high supply rate in March - along with global oil supply
Global oil supply jumped an estimated 1m barrels a day (b/d) month-on-month in March to 95.2m b/d, as Opec production hit its highest monthly increase in nearly four years.
Annual gains of 3.5m b/d were split between Opec and non-Opec production, data from the International Energy Agency (IEA) showed in its latest market report.
At the same time, the global oil demand forecast for 2015 was raised 90,000 b/d to 93.6m b/d, a gain of 1.1m b/d on the year – a notable acceleration on 2014’s 0.7m b/d expansion – as the global economy slowly picks up, reported the IEA.
Early indications suggest that Opec’s robust March production levels, up nearly 1.5m b/d on the year before, may be sustained – and possibly rise further - in April.
In March, the producer group’s crude output soared by 890,000 b/d on February figures to 31.02m b/d as top exporter Saudi Arabia ramped up output towards record rates. Production from Iraq and Libya also rebounded strongly.
The second-half 2015 call on Opec was revised a touch higher to 30.35m b/d, above the group’s official production ceiling, but left unchanged for 2015 at 29.5m b/d.
Non-Opec oil production is estimated to have increased by about 100,000 to 57.7m b/d in March, led by the US, with Russia also contributing. Year-on-year, non-Opec supply is estimated to have risen by around 1.8m b/d.
Global refinery crude demand is expected to fall seasonally to 77.3m b/d in the second quarter 2015, from 78m b/d in the first quarter. While Atlantic basin refiners mostly completed turnarounds in the first quarter, Asian refinery maintenance is set to ramp up sharply in the second quarter, with up to 2.5m b/d of distillation capacity offline at its peak in May.