OPEC MOMR (Dec): 2023 world oil demand unchanged from prior of 2.5mln BPD, 2024 world oil demand also unchanged M/M expected to rise by 2.2mln BPD

DEMAND

• For 2023 remains unchanged from last month’s estimate at 2.5mln BPD.
• Downward revisions in the OECD Europe and Asia Pacific in 3Q23 and 4Q23 are offset by upward revisions in OECD Americas.
• For 2024, world oil demand is expected to grow by a healthy 2.2 mb/d, unchanged from the previous month’s assessment.
• The OECD demand is expected to expand by about 300k BPD, with OECD Americas contributing the largest increase. The non-OECD is expected to increase by around 2.0mln BPD. led by growth in China, India, the Middle East, and Other Asia.

SUPPLY

• For 2024, non-OPEC liquids production is expected to expand by 1.4mln BPD, broadly unchanged from the previous month’s assessment
• The main drivers for liquids supply growth next year are expected to be the US, Canada, Guyana, Brazil, Norway and Kazakhstan.
• OPEC-13 crude oil production in November averaged decreased by 57k BPD M/M to average 27.84mln BPD (vs 27.90mln BPD in September)
• Crude oil output increased mainly in Venezuela, Libya and Kuwait, while production in Iraq, Angola and Nigeria decreased.

PRICES

• Crude oil futures prices experienced a significant downturn, marked by heavy selloffs amidst a highly  volatile futures market. 
• Speculators played a major role in this trend, cutting their bullish positions sharply  while increasing short positions. 
• The market dynamic was fuelled by exaggerated concerns about oil  demand growth, which negatively impacted market sentiment.
• OPEC Secretariat remains cautiously optimistic about the fundamental factors  affecting oil market dynamics in 2024.

OTHER COMMENTS

• Dirty freight rates recovered further in November, on tightening availability, although they remained below the volatile levels seen in the same month last year.
• In the US, heating fuels are also expected to see an uptick due to seasonal winter demand. However, industrial output has been on a prolonged downward trend, and road transportation is expected to soften during the winter season, thus dampening diesel and gasoline demand.
• In OECD APAC, following expected temperature declines during the winter season, extended government energy subsidies in Japan are also expected to support oil demand.
• China’s crude imports recovered some of the previous month’s decline, averaging 11.6mln BPD in October, a gain of almost 4% M/M. China’s product exports slipped a further 8% M/M, with drops driven by gasoline, naphtha, and other products category.