Output on the rise, as Opec compliance slips
THE IEA has raised its global oil-demand prediction for 2009, after OECD countries experienced stronger-than-expected demand during the first quarter. Global demand is projected at 8.3m b/d this year – down by 2.5m b/d, or 2.9%, from 2008, although the figure is 120,000 b/d higher than the agency predicted in May. The IEA says the upward revision does not "necessarily imply the beginnings of a global economic recovery, but may signal the bottoming-out of the recession".
Meanwhile, global oil supply fell in May to 81.4m b/d, down by 220,000 b/d from the month before, as a decline of 370,000 b/d from non-Opec supplies, mostly in OECD countries, outstripped higher Opec production of 160,000 b/d. Supplies are 3.2m b/d below levels in May 2008.
Increased Opec output to 28.4m b/d marked the second consecutive monthly rise. Production by the 11 members with output targets, which excludes Iraq, rose by 110,000 b/d, to 26.0m b/d, about 1.1m b/d over the cartel's 24.85m b/d target – a 74% compliance rate, compared with 76% in April. Iran and Angola accounted for about 55% of the above-target output. Opec ministers will next meet on 9 September to review the market outlook.
The IEA has revised up its 2009 non-Opec supply forecast by 170,000 b/d because of higher-than-expected Russian, North Sea and Colombian production in April and May. Total non-Opec supply is now expected to decline by a more modest 100,000 b/d, from 50.6m b/d in 2008, to 50.5m b/d this year.