Global supply holding steady at 3.2m b/d
Data from the International Energy Agency has showed growth in global oil supply
Despite slowing US light tight oil output, global oil supply growth remained at a steep 3.2 million barrels per day (b/d) year-on-year in April. At 95.7m b/d, total oil supplies were flat from March as higher Opec output offset a drop in non-Opec data from the International Energy Agency (IEA) showed.
Still, non-Opec supply growth for 2015 is projected to reach 830,000 b/d, up by 200,000 b/d, since the IEA’s last report, on surprisingly strong output in the first quarter from a number of countries, including Russia, China, Colombia, Vietnam and Malaysia.
Opec output increased by 160,000 b/d to total 31.21m b/d in April – the highest since September 2012 – as Iraq and Iran boosted output and top exporter Saudi Arabia held flows above 10m b/d for a second month running. Early soundings suggested that Opec would sustain rates at 31m b/d during May.
The move by the group’s core Gulf members last November not to cut production in a bid to defend prices was only the first step in a plan that includes actually ramping up output and aggressively investing in future production capacity – even as their non-Opec counterparts keep tightening their belts. Iraq and Libya, meanwhile, continue to raise production. Iranian supplies hit their highest since July 2012, when international sanctions on Tehran’s crude exports took hold, as India returned to buy.
Non-Opec production for April is estimated to have slipped by 260,000 b/d on March volumes, to 57.9m b/d, due in part to lower flows from North America.
Global refinery crude runs are expected to dip seasonally to 77.8m b/d in the second quarter, from 78.2m b/d in the first quarter. Estimates have been lifted markedly on robust runs in Asia and Europe.
OECD industry oil stocks rose counter-seasonally in March by 38.4m barrels, led by US crude, reported the IEA.