(EnergyAsia, February 26 2015, Thursday) — Reflecting the bleak outlook on oil prices, the US Energy Information Administration (EIA) expects a further narrowing of the global supply-demand gap on slowing production growth next year.


In its February report, the US government agency is forecasting global liquid fuels supply to grow by 0.5% in 2016, down progressively from the preceding months’ forecasts of 0.58%, 0.86% and 1.04%.

Supply will still reach new all-time highs of 93.76 million b/d in 2015 and 94.23 million b/d next year, but the net surplus will narrow as the EIA has raised annual global demand growth by 1.1% to 93.14 million b/d and 1.08% 94.15 million b/d over the next two years.

Amid the on-going slowdown in US production growth, the agency kept its crude price forecast unchanged with North Sea Brent to average $58 per barrel in 2015 and US West Texas Intermediate (WTI) to trade at US$54 to $55.

US liquids production growth is expected to weaken to 3.51% to 15.35 million b/d in 2016 after a projected 6.38% surge to 14.83 million b/d this year. A weakening trend is in sight as the EIA held its latest forecast for US production this year unchanged from last month.

Unplanned supply disruptions among non-OPEC producers averaged slightly more than 600,000 b/d in 2014, about 200,000 b/d less than the previous year. Crude oil production declines in Libya, Angola, Algeria and Kuwait more than offset production growth in Iraq and Iran, said the EIA.

Iraq, the largest contributor to OPEC production growth, is shaping up as a growing concern on the rising military threat of the Islamic State (ISIS).

EIA expects OPEC surplus crude oil production capacity, which is concentrated in Saudi Arabia, to increase to an annual average of 2.3 million b/d in 2015 and 2.7 million b/d in 2016, after averaging about two million b/d last year.

“Surplus capacity is typically an indication of market conditions, and surplus capacity below 2.5 million b/d is an indicator of a relatively tight market,” it said. However, the current and forecast levels of global inventory builds make the projected low surplus capacity level in 2015 less significant.

The agency expects global oil inventories to continue to build in 2015, limiting upward pressure on oil prices because of declining drilling activity.

Feb 2014: EIA’s world liquids demand forecast, in million b/d

2014    2015 * y/y %   2016 * y/y %

  1. America 23.42 23.68   1.11     23.76   0.34

China                          10.67   11.00   3.09     11.34   3.09

Others                                    58.04   58.46   0.72     59.05   1.00

TOTAL                         92.13   93.14   1.10     94.15   1.08

*forecast

 

Jan 2014: EIA’s world liquids demand forecast, in million b/d

2014    2015 * y/y %   2016 * y/y %

  1. America 23.45 23.67   0.94     23.76   0.38

China                          10.98   11.30   2.91     11.65   3.10

Others                                    56.96   57.42   0.81     57.47   0.09

TOTAL                         91.39   92.39   1.09     93.42   1.11

*forecast

 

Dec 2014: EIA’s world liquids demand forecast, in million b/d

2013    2014 * y/y %   2015 * y/y %

  1. America 23.44 23.39   -0.21    23.51   0.51

China                          10.61   10.98   3.49     11.34   3.28

Others                                    56.43   57.07   1.13     57.47   0.70

TOTAL                         90.48   91.44   1.06     92.32   0.96

*forecast

Nov 2014: EIA’s world liquids demand forecast, in million b/d

2013    2014 * y/y %   2015 * y/y %

  1. America 23.44 23.34   -0.43    23.48   0.60

China                          10.61   10.98   3.49     11.34   3.28

Others                                    56.43   57.06   1.11     57.68   1.09

TOTAL                         90.48   91.38   0.99     92.50   1.23

*forecast

 

Oct 2014: EIA’s world liquids demand forecast, in million b/d

2013    2014 * y/y %   2015 * y/y %

  1. America 23.40 23.36   -0.17    23.56   0.86

China                          10.61   10.98   3.49     11.35   3.37

Others                                    56.44   57.13   1.22     57.80   1.17

TOTAL                         90.45   91.47   1.13     92.71   1.36

*forecast

 

Feb 2015: EIA’s world liquids supply forecast, in million b/d

2014    2015 * y/y %   2016 * y/y %

OPEC                           36.49   36.49   0.00     36.18   0.85

Non-OPEC                   56.45   57.27   1.45     58.05   1.36

– US                                              13.94     14.83     6.38        15.35     3.51

TOTAL                         92.94   93.76   0.88     94.23   0.50

*forecast

Jan 2015: EIA’s world liquids supply forecast, in million b/d

2014    2015 * y/y %   2016 * y/y %

OPEC                           36.00   36.13   0.36     36.14   0.03

Non-OPEC                   56.18   56.84   1.17     57.37   0.93

– US                                              13.98     14.83     6.08        15.37     3.65

TOTAL                         92.18   92.97   0.86     93.51   0.58

*forecast

 

Dec 2014: EIA’s world liquids supply forecast, in million b/d

2013    2014 * y/y %   2015 * y/y %

OPEC                           36.03   35.96   -0.19    35.92   -0.11

Non-OPEC                   54.13   56.00   3.45     56.84   1.50

– US                                              12.34     13.90     12.64     14.89     7.12

TOTAL                         90.16   91.96   2.00     92.75   0.86

*forecast

Nov 2014: EIA’s world liquids supply forecast, in million b/d

2013    2014 * y/y %   2015 * y/y %

OPEC                           36.03   35.92   -0.31    35.93   0.02

Non-OPEC                   54.16   56.03   3.45     56.98   1.70

– US                                              12.36     13.86     12.14     14.95     7.86

TOTAL                         90.18   91.95   1.96     92.91   1.04

*forecast

 

Oct 2014: EIA’s world liquids supply forecast, in million b/d

2013    2014 * y/y %   2015 * y/y %

OPEC                           36.03   35.78   -0.69    35.51   -0.75

Non-OPEC                   54.12   55.98   3.44     57.15   2.09

– US                                              12.34     13.82     11.99     15.05     8.90

TOTAL                         90.15   91.76   1.79     92.67   0.99

*forecast

 

 

 

 

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