Baku, Azerbaijan, Apr. 12
By Elena Kosolapova – Trend:
OPEC expects world oil demand to increase by 1.27 million barrels per day to average 96.32 million barrels per day in 2017, the cartel said in its monthly oil market report published April 12.
This figure is higher by approximately 10,000 million barrels per day from the previous month’s projections.
The upward revision was mainly to reflect better-than-expected data for China during 1Q17. The ‘Other Asia’ group (non-OECD Asia), which includes India, is anticipated to lead oil demand growth in 2017, followed by China and OECD Americas. OECD Asia Pacific is the only region anticipated to see a decline in oil demand in 2017.
Oil demand growth in the OECD region is anticipated to be at 0.24 million barrels per day year-over-year in 2017 and peak in 3Q mainly supported by the US summer driving season. The bulk of the OECD growth is projected to be seen in OECD America, with the US leading the way.
OECD Europe is also anticipated to be in positive territory for the third consecutive year, especially after solid data for the first two months of the year, which were primarily supported by higher heating oil requirements due to cold weather.
OECD Asia Pacific is the only region expected to conclude 2017 with a negative oil demand growth, with Japan declining, although South Korea is anticipated to provide some support.
Oil demand growth in non-OECD is currently anticipated at around 1.02 million barrels per day year-over-year. Sluggish data from India for the first two months of 2017, as a result of the demonetisation policy implemented in 4Q16, drew negative views on the 1Q17 data for the whole of the ‘Other Asia’ region. This led to a downward revision for this region of 40,000 barrels per day in 1Q17. However, looking ahead, oil demand projections remain positive, especially in 2H17, when the consequences of the demonetisation policy in India fade away.
Latin America was revised lower by 30,000 barrels per day in 1Q17 due to slower economic momentum denting oil demand growth.
In China, an upward revision of 120,000 barrels per day in 1Q17 was the result of better-than-expected demand in the country’s transportation and petrochemical sectors.