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HIGHLIGHTS
OPECcrudesupplyroseby315kb/dFebruary,ledbyathreedecade
peak in Saudi output and a sharp recovery in Libyan production.
Outputof31.42mb/dwasthehighestlevelsincemid2008.Thecall
onOPECcrudeandstockchangefor2012israisedby0.2mb/dfor
2Q12 and 3Q12, to average of 30.1mb/d, due to lower forecast
nonOPECsupplies.
Globalrefinerycrudethroughputsarelargelyunchangedfor1Q12,as
weakerthanexpected nonOECD readings were offset by a counter
seasonalincreaseinUSrunsinFebruary.4Q11runs,however,werea
sizable 300 kb/d lower, falling 120 kb/d yoy. Runs should rise
180kb/din1Q12and600kb/din2Q12,to74.9mb/dand74.5mb/d,
respectively.
OECDindustryoilstocksincreasedbyamuted13.6mbto2614mb
in January, remaining below the fiveyear average for a seventh
consecutive month. Forward demand cover rose to 57.8 days.
Februarypreliminarydataindicateaseasonal12.6mbdropinOECD
industrystocks.
TABLE OF CONTENTS
HIGHLIGHTS....................................................................................................................................................................................... 1
A HEADY BREW ................................................................................................................................................................................ 4
DEMAND ............................................................................................................................................................................................. 5
Summary........................................................................................................................................................................................... 5
Global Overview ............................................................................................................................................................................ 5
OECD ............................................................................................................................................................................................... 6
North America .......................................................................................................................................................................... 7
Europe ......................................................................................................................................................................................... 8
Pacific ........................................................................................................................................................................................... 9
Non-OECD ................................................................................................................................................................................... 10
China .......................................................................................................................................................................................... 12
Other Non-OECD.................................................................................................................................................................. 13
Brazilian Gasoline: A Bitter Mix ..................................................................................................................................... 14
SUPPLY ................................................................................................................................................................................................ 15
Summary......................................................................................................................................................................................... 15
OPEC Crude Oil Supply ............................................................................................................................................................. 16
European Refiners Tapped Other OPEC Supply to Replace Lost Libyan Barrels ..................................................... 19
OECD ............................................................................................................................................................................................. 20
North America ........................................................................................................................................................................ 20
North Sea.................................................................................................................................................................................. 21
Other OECD ........................................................................................................................................................................... 22
Non-OECD ................................................................................................................................................................................... 23
Former Soviet Union .............................................................................................................................................................. 23
Latin America ........................................................................................................................................................................... 24
Asia ............................................................................................................................................................................................. 25
Africa .......................................................................................................................................................................................... 25
Middle East................................................................................................................................................................................ 26
OECD STOCKS ................................................................................................................................................................................ 27
Summary......................................................................................................................................................................................... 27
OECD Inventories at End-January and Revisions to Preliminary Data .................................................................... 27
Analysis of Recent OECD Industry Stock Changes .............................................................................................................. 28
OECD North America........................................................................................................................................................... 28
OECD Europe.......................................................................................................................................................................... 29
OECD Pacific ........................................................................................................................................................................... 30
Recent Developments in Singapore and China Stocks......................................................................................................... 31
PRICES ................................................................................................................................................................................................. 33
Summary......................................................................................................................................................................................... 33
Market Overview ......................................................................................................................................................................... 33
Futures Markets ............................................................................................................................................................................ 35
Activity Levels .......................................................................................................................................................................... 35
Market Regulation ................................................................................................................................................................... 37
High Frequency Traders: Flash Crashers or Liquidity Providers? ........................................................................... 38
Spot Crude Oil Prices ................................................................................................................................................................. 40
REFINING ........................................................................................................................................................................................... 45
Summary......................................................................................................................................................................................... 45
Global Refining Overview........................................................................................................................................................... 45
OECD Refinery Throughput...................................................................................................................................................... 47
Petroplus Assets Back in Action .......................................................................................................................................... 51
Non-OECD Refinery Throughput ............................................................................................................................................ 52
Russian Refinery Runs Boosted by Higher Prices............................................................................................................. 53
TABLES................................................................................................................................................................................................ 56
TheIEAisSeekingtoRecruitaHeadoftheOilIndustryandMarketsDivision
TheInternationalEnergyAgency(IEA)isseekingadynamicandexperiencedenergyexperttoserveastheEditor
oftheIEAOilMarketReportaswellasleadingitsOilIndustryandMarketsDivision.Heorshewillsuperviseand
coordinatetheIEA'sworkonthemonitoringofandreportingonoilindustryandmarketdevelopments.
Majorresponsibilitiesinclude:
Plan,leadandcoordinatethepreparationoftheIEA'smonthlyOilMarketReport,annualMediumTermOil
Market Report and Annual Statistical Supplement, the presentation of results for the Governing Board and
theStandingGroupontheOilMarket(SOM),andfollowupwithmedia,governmentsandtheoilindustry.
AdviseGovernmentsonrecenttrendsintheglobaloilmarketandmediumtermdevelopmentsandanalysis
on the role of physical and financial markets in oil price formation, particularly highlighting policyrelated
issues and recommending appropriate action; plan and coordinate meetings of the Standing Group on the
OilMarket.
Supervisetheworkofprofessionalandsupportstaffandconsultants.
Developandmaintainclosecontactswithgovernmentofficialsonimportantpolicydevelopments,aswellas
withoilcompaniesandconsultants.
CooperatewithotherDivisionsintheIEAon,interalia,oilindustryaspectsoftheirwork,countryreviews,
thedevelopmentoflongrangeenergyoutlooksandenvironmentalissues.
Provide market information and expertise during oil emergencies and support and participate in exercises
relatedtomaintainingemergencyresponsecapabilities.
Theidealcandidatewillpossess:
Anadvanceduniversitydegreeineconomics,science,engineering,orarelateddiscipline.
Tentofifteenyears'experienceintheinternationaloilindustrywithexperienceinthefieldofoilandenergy
policy.Specificareasofexpertiseincludeanyorallofthefollowing:oilproduction,refininganddistribution,
oiltrade,oilstockpolicyorproductqualityissues.
Strong analytical, communication and interpersonal skills, political sensitivity and ability to establish and
maintaineffectiveworkingrelationswithseniorgovernmentandindustryofficials.
Proven ability in teambuilding as well as in planning, coordinating and supervising team work. Strong
achievement orientation and personal initiative, as well as the ability to work under pressure, often to tight
deadlines.
An excellent level of oral and written communication skills and excellent drafting ability in English; working
knowledgeofFrenchandotherlanguageswouldbeanadvantage.
The IEA operates as an autonomous agency within the Organisation for Economic Cooperation and
Development(OECD).
ThefullvacancynoteandonlineapplicationformisavailableontheOECDwebsiteatwww.oecd.org.Clickon
JobVacanciesHeadofDivision:Oilindustry&MarketsDivision JobReferenceNo.08112.Thepositionwill
start1July2012.
Onlineapplications(inEnglishorFrench)fromnationalsofOECDmembercountriesshouldbesubmittedbyno
laterthanmidnight(CET)on25March2012.
TheOECDisanequalopportunityemployerofferinganattractiveremunerationpackageand
encouragesapplicationsfromallqualifiedcandidates.
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
Organisation de coopration et de dveloppement conomiques
M ARKET O VERVIEW
A HEADY BREW
Geopoliticalrisksareeverpresentintheoilmarket,andpromptfiercedebateaboutthedegreeofrisk
premium in prevailing price levels. However, quantifying a risk premium is a lot harder than surmising
thatoneexists.Currentmarketdynamicsarehighlycomplex,andincludeaheadybrewofbothrealand
anticipatedsupplysiderisks,alongsideaveryevidenttighteninginactualmarketfundamentalsthathas
beenunderwaysincemid2010.Concernsoverdislocationstonormalinterregionaltradederivingfrom
the economic measures taken against Iran, and this more prosaic ongoing tightening in the
supply/demandbalance,havecombinedtoleadpriceshigherby20%sinceDecember.Lastmonth,we
focusedonsomeofthemidstreamanddownstreammicrofactorscurrentlyatplayintheoilmarket,
and which are influencing price differentials and arbitrage flows. This month, it seems appropriate to
stand back and acknowledge a big picture that, arguably, explains more of the price strength seen in
recentmonthsthandoesspeculationaboutrealandperceivedgeopoliticalrisks.
9
8
7
6
5
4
3
2
1
0
2000
2001
2002
2003
2004
2005
2006
Iraq
2007
2008
Ven/Nig
2009
2010
2011
2012
Libya
Marketfocusshiftedsometimeagofromdemandtosupply(asdemandgrowthin2011and2012will
likely average only 30% of 2010s 2.7 mb/d). There may be no actual physical supply disruption at
present deriving from the Iranian issue. But there are ongoing nonOPEC outages totalling around
750kb/d, as a slew of technical and political factors continue to hobble nonOPEC supply, otherwise
expectedtoreboundafterafeeble2011.Demandgrowthwilllikelyremainstuntedbyweakereconomic
prospects(themoresoifpricesstayhigh),butarealriskofanotheryearofunderperformingnonOPEC
supply shines a spotlight once more on OPEC spare capacity. It is no coincidence that the last time
effective spare capacity headed south of 3 mb/d, prices too were on a sustained rise. Temperatures
surrounding the Iranian issue may well cool, and nonOPEC output should recover as 2012 progresses.
Until then, the markets relatively slim buffer suggests a bumpy ride in the months ahead.
D EMAND
DEMAND
Summary
Highoilpricesandasubduedglobaleconomicbackdropareexpectedtocontaindemandforoilin
2012. Global oil consumption is seen reaching 89.9mb/d in 2012, a gain of 0.8mb/d (or 0.9%) on
2011.Estimatesforabsolutedemandandgrowthfor2011and2012arelargelyunchangedcompared
tolastmonthsreport.
The preliminary data series for January indicates global oil demand of 88.4 mb/d, 0.7 mb/d more
thanassumedlastmonth.SignificantlystrongerdatafromChina(up475kb/donourmonthearlier
estimate),Germany(+115kb/d)andJapan(+110kb/d)leadtherevision,althoughhigherpriceslimit
feedthroughtotherestof2012.
Africa
Americas
Asia/Pacific
Europe
FSU
Middle East
World
Annual Chg (%)
Annual Chg (mb/d)
Changes from last OMR (mb/d)
2010
3.4
30.1
27.3
15.3
4.5
7.8
88.3
3.2
2.8
0.00
2011
3.3
30.0
28.1
15.0
4.7
8.0
89.1
0.9
0.8
0.01
2012
3.5
30.0
28.7
14.6
4.8
8.2
89.9
0.9
0.8
0.01
Global Overview
Theworldislikelytoseearelativelymodestexpansioninoilproductconsumptionin2012,asasubdued
economic backdrop coincides with relatively high oil prices. The IMF, in Januarys World Economic
Outlook,assumedthatglobaleconomicgrowthwoulddecelerateto3.3%in2012,from3.8%in2011and
5.2%in2010.Havingrisento89.1mb/din2011,globaloilconsumptionisforecasttoriseby0.8mb/d
(0.9%)in2012,to89.9mb/d.The2011estimateislargelyunchangedonlastmonthsview,revisedup
only10kb/d.
Asiaisprojectedtodominateglobaloildemandgrowthin2012,expandingbyanunchanged0.7mb/dto
28.7mb/d (comprising both nonOECD and OECD). China is expected to be the greatest individual
contributor,withitsdemandforecasttoriseby370kb/din2012,to9.9mb/d.Ouranalysisimpliesthat
totalAsiandemandgrowthwillbeover80%ofthepredictedglobalexpansion,withChinaaccountingfor
45%oftheworldnumber.Suchsharesimplyalessercontributionthanin2011,whenAsiaaccountedfor
nearly90%oftheexpansionandChinacontributednearly60%ofthetotalgrowth.ThisdiminishedAsian
shareispredictedtooccurasotherregions,suchasAfrica,recover.Significantgainsindemandarealso
predicted in the oilrich regions of the world, suchas the Middle East, the former Soviet Union, Africa
and Latin America. Although for most countries high oil prices act as a disincentive to consume, they
often have the opposite effect in resourcerich nations, encouraging additional expenditure
D EMAND
programmes.Oilconsumptioncanbestimulatedeitherdirectlythroughsubsidisingdomesticoilprices,
indirectlythroughinvestmentinrelativelyoilintensiveprojectsormaysimplyincreaseinlinewithrising
incomes. The Middle East is a prime example, notably Saudi Arabia, as numerous infrastructural and
socialspendingprogrammeshavebeenconfirmedfor2012.
North America
Europe
FSU
472
280
225
-110
113
-300
-324
1449
Middle East
-125
290
-264
200
155
Asia
739
679
Latin America
304
203
67
158
Africa
166
-50
2010
2011
2012
2.75
0.75
0.82
3.2%
0.9%
0.9%
Slowgrowth Europe, compounded by record European oil prices, is expected to see the weakest
demandtrendin2012,withconsumptionforecasttodeclineby0.3mb/d(2.2%)to14.6mb/d(includes
nonOECD Europe). A decline of 0.1mb/d (0.5%) to 23.3mb/d is assumed for North America, as oil
demandcontinueslongtermstructuraldecline,augmentedbytheimpactofhighinternationalpriceson
aUSmarketwhichisnotshieldedbyeithersubsidiesortaxes.
OECD
ThepreliminarydataseriesforJanuaryimpliestotaloilproductdemandintheOECDfallingby0.7mb/d
(1.4%) on a yearonyear basis, to 45.1mb/d. Leaving aside the specific regional drivers (analysed in
detail later), it is apparent that the relative strength of industry supported consumption of LPG (1.8%
higher)anddiesel(+0.7%).Gasoline(1.3%)consumptionlaggedbehind,asweakconsumerconfidence
inEuropeandrisingpumppricesdepresseddemand.
Gasoline
mb/d
% pa
OECD North America*
US50
Canada
Mexico
OECD Europe
Germany
United Kingdom
France
Italy
Spain
OECD Pacific
Japan
Korea
Australia
OECD Total
* Including US territories
9.74
8.21
0.72
0.76
1.90
0.44
0.31
0.15
0.21
0.11
1.46
0.91
0.19
0.30
13.10
-1.8
-2.5
1.6
2.7
-1.5
6.4
-2.1
-4.6
0.3
-4.5
2.5
0.9
7.6
1.6
-1.3
Jet/Kerosene
mb/d
% pa
1.52
1.32
0.10
0.06
1.14
0.17
0.34
0.14
0.08
0.09
1.20
0.84
0.21
0.13
3.86
-3.0
-4.0
2.4
9.3
-3.4
3.5
-1.7
-1.6
-2.8
-7.2
-6.6
-4.9
-19.0
1.4
-4.3
Diesel
mb/d
% pa
3.76
3.19
0.21
0.31
3.84
0.61
0.45
0.66
0.40
0.41
0.97
0.36
0.24
0.32
8.57
-0.1
-0.7
-0.6
6.0
1.5
9.0
3.9
2.8
-3.4
-2.5
1.1
-3.7
1.1
5.7
0.7
Other Gasoil
mb/d % pa
RFO
mb/d % pa
Other
mb/d
% pa
Total Products
mb/d
% pa
1.02
0.52
0.35
0.13
1.69
0.37
0.09
0.28
0.10
0.21
0.58
0.46
0.12
0.00
3.30
0.91
0.57
0.10
0.15
1.23
0.17
0.07
0.08
0.08
0.17
1.02
0.68
0.31
0.02
3.16
6.16
4.81
0.70
0.60
3.40
0.59
0.31
0.39
0.39
0.32
3.51
2.05
1.30
0.15
13.07
23.11
18.63
2.19
2.01
13.20
2.35
1.57
1.70
1.27
1.31
8.74
5.31
2.36
0.92
45.06
-20.2
-31.3
-7.8
6.0
-6.5
7.7
-5.4
-22.7
-3.2
-5.7
-2.4
-1.3
-7.1
0.0
-10.6
-6.7
-11.3
-11.3
16.2
-5.7
5.4
-5.6
10.0
-15.3
-9.5
20.7
58.3
-21.0
2.4
1.1
-0.56
0.3
-5.5
-1.8
-6.3
-2.7
-5.7
-7.9
-10.4
-5.3
7.3
10.1
4.9
-5.2
-0.2
-2.5
-3.0
-3.1
3.1
-3.2
4.5
-1.5
-5.6
-5.9
-5.1
4.3
7.8
-2.6
1.8
-1.4
D EMAND
For2012asawhole,OECDdemandisexpectedtocontractby0.4mb/d(0.9%),to45.2mb/d.Fueloil
demand is predicted to display the greatest relative decline, down 1.6% on the year, as tighter
environmental regulations and ongoing fuel substitution curb demand and outweigh the nuclear
replacement gains envisaged in Japan. Near 1% declines are expected in gasoline and jet/kerosene, as
transportmarketsparticularlysufferontheweakereconomicbackdrop.OECDeconomicgrowthof1.1%
is projected for 2012, down sharply on 2011s 1.6% expansion, encouraging consumers to rationalise
personaltransportchoices.Carpoolingandincreaseduseofpublictransportareagainontheagendaon
bothsidesoftheAtlantic.
m b/d
52
m b/d
16.0
15.5
49
15.0
14.5
46
14.0
13.5
43
Jan
Apr
Jul
Range 2007-2011
2011
Oct
13.0
Jan
5-year avg
2012
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
North America
The preliminary data series for January indicates North American oil product demand of 23.1mb/d, a
declineof0.6mb/d(2.5%)onthecorrespondingmonthlastyear.Weareforecastingamoderationin
thepaceatwhichNorthAmericandemandfalls,125kb/d(0.5%)fortheyearasawhole,to23.4mb/d.
Gasolinewilllag,fallingby80kb/d(0.7%)to10.2mb/d,ashighpricesimpactdemand.TheUSwilllikely
lead the gasoline reversal, as demand is projected to fall by 80kb/d (0.9%) in 2012 to 8.7mb/d, its
fourthfallinfiveyears.USgasolinedemandappearstohaveembarkedupontheearlystagesofalong
termstructuraldecline.Thisforecastisbasedonanassumptionthatlowermilestravelledandamore
efficientvehiclefleet,particularly inlightof highprices,outweighthelikely growthindrivernumbers,
whichwillbelimitedbydemographictrendstoaround1%perannum.TotalUSoilproductdemandis
forecasttofallby0.1mb/d(0.6%)to18.8mb/d,onparwithlastmonthsprojections.
kb/d
10,000
kb/d
21,500
9,500
20,500
9,000
19,500
8,500
18,500
8,000
17,500
Jan
Apr
Range 2007-2011
2011
Jul
Oct
5-year avg
2012
Jan
Jan
Apr
Range 2007-2011
2011
Jul
Oct
Jan
5-year avg
2012
BuckingthefallingtrendinoverallUSdemandhoweverisourforecastthatdiesel,LPGandnaphthaall
risein2012.Dieselshouldaddnearly30kb/d(0.8%),to3.5mb/d,supportedbytherelativestrengthof
themanufacturingsector.
D EMAND
InMexico,oildemandgrewby3.1%yoyinJanuary.Stronggrowthinindustrialactivityandhighlevels
ofconsumerconfidencegavesupporttoallproducts,barLPGandnaphtha.Despitethis,demandin2012
is forecast to remain flat versus 2011 overall, at 2.1 mb/d, with downside risks associated with an
economicslowdownintheUS.
Europe
European debt concerns escalated throughout 2011, depressing consumer and business confidence
alike, resulting in falling GDP in much of Europe in 4Q11. A prevailing European oil demand decline
accelerated,with0.8mb/dofconsumptionremovedin4Q11(down5.1%on4Q10),to14.1mb/d.The
greatest falls were in the more heavily indebted economies of southern Europe, with 4Q11 demand
downby14.4%yearonyearinGreece,7.2%lowerinSpainand8.2%downinItaly.For2011,European
oilconsumptionintotalfellby0.3mb/d(2.2%)to14.3mb/d.
Despite a reprieve in February as colderthannormal weather stimulated heating oil demand the
boostindemandisexpectedtobetemporary,asnormaltemperaturesareassumedfortheremainderof
2012. European oil demand is therefore forecast to fall to 13.9mb/d in 2012, a further 0.3mb/d
contraction(2.3%).
Days
100
m b/d
16.5
16.0
15.5
15.0
14.5
14.0
13.5
13.0
50
(50)
(100)
(150)
Feb 11
May 11
Aug 11
Nov 11
Feb 12
OECD Europe:
Total Oil Product Demand
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
EvenrelativelyrobusteconomieslikeGermany,whichhaveprovidedanelementofeconomicsupportto
Europeasawhole,sawdemandfallinthesecondhalfof2011,withyearonyeardeclinesof0.1mb/din
both3Q11and4Q11.PreliminaryJanuarydatadepicteda4.5%yearonyeargainof0.1mb/d,to2.3mb/d,
buttheforecastfor2012Germandemandremainsonadownwardtrend,downby0.4%to2.4mb/d.
m b/d
0.2
0.1
(0.1)
(0.2)
(0.3)
2010
Gasoline
2011
Diesel
2012
Other
Jan
ConsolidateddataforSpaininDecembershoweda7.5%yearonyeardemandcontraction,to1.3mb/d.
Consumptionfellastheunemploymentraterosetoa15yearhighof21.5%inthesamemonth.Allthe
major product categories saw sharp declines, although the key transportation fuel markets fared the
D EMAND
worst.Gasolinedemandfell6.6%yoy,whileconsumptionofdieseldropped5.4%.Reportsofwarmer
thannormalweatherinDecemberfurthercurtailedheatingoildemand,whichwasdown11.3%.
OtherMediterraneaneconomies,suchasItaly,PortugalandGreece,alsosawsharpdropsindemand.
The preliminary series for Italy fell by 6% yoy in January, to 1.3mb/d. Big falls in naphtha (19.8%),
gasoil (3.4%) and jet/kerosene (2.8%) outweighed gains in LPG (3.4%) and gasoline (0.3%). A slight
moderation in weakening Italian demand is expected for 2012, averaging 4.8%, as the worst of the
economicmalaiseeasesrunningfromthefirsttothesecondhalfoftheyear.Portuguesedemandfellby
19.7%inDecemberandGreekdemandby14.1%.ThepreliminarydataseriesforFrancedepicteda5.6%
declineinJanuary,to1.7mb/d,asunseasonablywarmearlywinterweatherresultedina22.7%decline
inheatingoil.
DecembersawlimitedgainsindemandintheUK,TurkeyandtheNetherlands,withUKconsumptionup
0.5%yoyto1.5mb/d,havingfallenineightoftheprecedingtenmonths.UKdieselconsumption(+13.5%
yoy)providedthemajorityofthemomentum,astheseasonaldipindieseldemandinDecemberproved
much less steep than usual. As the UK economy struggles with nearrecessionary conditions and record
highoilpriceshowever,demandisforecasttofallby2.2%(34kb/d)in2012,to1.6mb/d.
kb/d
1,900
1,850
1,800
1,750
1,700
1,650
1,600
1,550
1,500
kb/d
500
480
460
440
420
400
380
360
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
Demand for oil products in the Netherlands in December returned to the rising trend that has
predominatedsince2Q11,up4.3%onayearearlierto1.0mb/d.UnderpinningstrongerDutchdemand
were the sharp gains in the transportation fuel markets, with diesel demand up 13.5% and gasoline
surpassing this, rising by 14.6%. These rises were, however, largely attributable to the particularly
pronouncedlowsayearearlier.TurkishdemandalsoheldupremarkablywellinDecember,gaining9.3%
to0.7mb/d,althoughonceagainverylowconsumptionayearearlierflatteredtheannualtrend.Alltold,
exceptionally mild December European temperatures, while limiting heating demand, may have
stimulatedtransportfueldemandrelativetoweatheraffectedDecember2010levels.
Pacific
Preliminary data for the OECD Pacific in January highlighted the regions buoyancy, as yearonyear
demand growth came in at 4.3%, to average 8.7mb/d. Big gains in fuel oil (+20.7%), other products
(+20.4%)andLPG(+10.7%)outweighedcontractionsinjet/kerosene(6.6%)andtheheatingoilcategory
(2.4%). Ongoing closures in the Japanese nuclear sector continue to support demand for fuel oil and
other products (which includes crude oil for direct burn), acting as replacement fuels (alongside coal
andnaturalgas)intheelectricitysector.
D EMAND
9.5
Days
OECD Pacific:
Total Oil Product Demand
m b/d
80
60
9.0
40
8.5
20
-
8.0
(20)
7.5
(40)
7.0
(60)
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
Feb 11
May 11
Aug 11
Nov 11
Feb 12
AlthoughwarmertemperaturesthanayearearliersuppressedheatingoildemandinJanuary,theonset
ofcolderconditionsinFebruarylikelysawgrowthresume.Demandgrowthofaround60kb/d(0.9%)is
envisagedfor2012,takingconsumptionintheOECDPacificregionto7.9mb/din2012.
kb/d
2,500
OECD Pacific:
Residual Fuel Oil Demand
m b/d
1.2
1.1
1.0
0.9
0.8
0.7
0.6
0.5
2,400
2,300
2,200
2,100
2,000
1,900
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
South Korean consumption fell by 2.6% in January, according to preliminary data, continuing the
declining trend into a third month. It is important to put these falls in context, as they represent a
decline on the previous years exceptionally strong demand, and potentially signal moves by
costconsciousKoreanconsumerstowardsgreaterefficiencygainsinthefaceofrelentlesslyhighprices.
Weaker manufacturing sentiment as depicted by HSBCs South Korean Manufacturing PMI falling to
49.2 (whereby a number below 50 implies a contraction) has undermined Korean consumption of
gasoil(1.7%),fueloil(21.0%)andjet/kerosene(19.0%)inJanuary.Robustdomesticdemandcontinued
to support gasoline, with growth up to a sixmonth high of 7.6%. Oil demand growth is expected to
resume for the year as a whole, up by 0.5% to 2.2mb/d in 2012, as the underlying economic picture
remainssupportive,withrealGDPgrowthofaround3.5%envisaged.
Japaneseoilproductdemandroseby0.4mb/d,or7.9%yearonyear,inDecemberonthebackofstrong
gainsinresidualfueloil(+170kb/d),otherproducts(+250kb/d)andLPG(+60kb/d).Partiallyoffsetting
these gains were the big declines seen in naphtha, gasoil and diesel. Japanese oil demand in 2012 is
expectedat4.5mb/dwithannualgrowthof40kb/dor0.9%.ThepowersectorhasdominatedJapanese
oildemandgrowthsincemidMarch2011snuclearclosures,burning165kb/dofcrudeoilin2011(up
135.5%)and160kb/doffueloil(+48.3%).
Non-OECD
Leadingtheworldsgrowthmomentum,ashasbeenthecasesincethemid1990s,nonOECDoildemand
isforecasttooutpacetheOECD,supportedbystrongereconomicunderpinningsandagenerallyhigher
incomeelasticity.Economicgrowthof5.7%isforeseeninthenonOECDin2012(6.2%in2011),whilstthe
10
D EMAND
OECD estimate is a more modest 1.1%. Coupled with an assumed greater dependence upon economic
growthinthenonOECD,oilproductdemandisexpectedtoriseby2.8%(or1.2mb/d)to44.7mb/d.
Demand
2010
2011
2012
2011
2012
2011
2012
4,734
4,973
5,112
238
140
5.0
2.8
Naphtha
2,680
2,651
2,671
-29
20
-1.1
0.8
Motor Gasoline
8,081
8,364
8,608
283
243
3.5
2.9
2,637
2,725
2,782
88
57
3.3
2.1
12,944
13,525
13,969
581
444
4.5
3.3
5,480
5,514
5,604
33
90
0.6
1.6
Other Products
5,601
5,699
5,917
99
218
1.8
3.8
Total Products
42,157
43,450
44,663
1,293
1,213
3.1
2.8
Gas/Diesel Oil
A similar growth structure is assumed for 2012 aswas seen in 2011, although a stronger expansion in
Africa (+5.0% against the Libyaninduced 1.5% contraction seen in 2011) counteracts weaker growth
elsewhere. The potential for further growth in vehicle ownership levels will continue to support the
transportation fuel markets in 2012, with gasoline demand forecast to rise by 2.9% (to 8.6mb/d) and
gasoilby3.3%(to14.0mb/d).Theotherproductscategorywillsimilarlythrive,forecasttoriseby3.8%
in2012,to5.9mb/d,supportedbystronggainsincrudeoilfordirectburnandbitumen(benefitingfrom
thebuoyantroadbuildingprogrammes).
m b/d
2.5
2.0
44
1.5
42
1.0
40
0.5
38
36
(0.5)
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
2009
China
Latam
2010
2011
Oth. Asia
Other
2012
M. East
Non-OECD
ThepreliminarynonOECDdataseriesforDecemberimpliesadecelerationinmomentumtowardsthe
endof2011,albeitmeasuredagainstexceptionallystronggrowthattheendof2010.Havingaveraged
3.1%growthin2011,andforecasttoriseby2.8%in2012,demandgrowthdippedto0.8%inDecember.
Weakdemandfromthepetrochemicalsector,adirectconsequenceoftheeconomicslowdown,caused
naphthademandtofallby7.4%inDecember.EarlyindicatorsforJanuaryimplyarecovery,asdemandis
estimatedtohaverisenby2.4%.
Non-OECD: Demand by Product
(thousand barrels per day)
Demand
Nov-11
Dec-11
Jan-12
Dec-11
Jan-12
Dec-11
5,061
5,120
5,072
266
164
5.5
3.3
Naphtha
2,798
2,590
2,734
-208
-87
-7.4
-3.1
Motor Gasoline
8,547
8,797
8,338
340
359
4.0
4.5
2.1
Jan-12
2,879
2,774
2,792
32
57
1.2
14,080
13,723
13,281
-56
321
-0.4
2.5
5,519
5,672
5,526
51
-187
0.9
-3.3
Other Products
5,693
5,561
5,618
-57
400
-1.0
7.7
Total Products
44,577
44,238
43,362
366
1,028
0.8
2.4
11
D EMAND
China
Havingsloweddramaticallytowardstheendof2011Chinesedemandgrowthreturnedtoasevenmonth
highinJanuary.Apparentdemandforoilproducts,i.e.netproductimportsplusrefineryoutput,roseby
6.0% yoy to 9.9mb/d. This relative gain, however, is largely technical, as late2011 data suffered in
comparisonto2010whenthe banon coalburning supported higheroildemand.Furthermore,official
refinerythroughputstatisticstendtobedistortedinJanuaryandFebruary,interruptedbytheLunarNew
Yearholidays,andrenderingcomparisonsdifficult.Allthesame,stronggainswereseeningasoline,up
10.6% on the corresponding month a year earlier to 1.8mb/d. The earlier Lunar New Year holiday
(January2012asopposedtoFebruaryin2011)temporarilysupportedgasolinedemandwithadditional
journeys made, but suppressed industrially important naphtha (0.7%) and fuel oil (15.8%) as many
businessesclosedfortheholidays.
From its end2011 lowpoint, Chinese demand growth is forecast to accelerate through 2012, as the
economicoutlookisexpectedtoimproveastheyearprogresses,andasthedepressanteffectongrowth
ofhighearly2011oildemandlevelsdiminishes.Fortheyearasawhole,consumptiongrowthof3.9%is
envisaged, taking apparent demand to 9.9mb/d, albeit this is lower than some thirdparty estimates
which envisage growth of as much as 5.5% for 2012. Underpinning our relatively cautious Chinese
growthestimateistheassumptionthateconomic growthwillfallbelow8.5% fortheyear asawhole.
The weaker outlook gains support from reports that the Chinese government has decided on a lower
growth target, of 7.5%, as opposed to the 8% target previously assumed. It is worth noting that
historically the government target has tended to act as a floor, with for example, 2011 GDP growth
exceeding9%despiteanearlierstatedintentionof8%.
kb/d
10,000
kb/d
3,600
9,500
3,400
9,000
3,200
8,500
3,000
8,000
2,800
7,500
2,600
7,000
2,400
6,500
2,200
Jan
Apr
Range 2007-2011
2011
Jul
Oct
5-year avg
2012
Jan
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
Demand
2012
2011
2012
2011
668
693
697
26
3.9
0.5
Naphtha
1,129
1,163
1,179
34
16
3.0
1.4
Motor Gasoline
1,546
1,655
1,721
109
66
7.1
4.0
368
402
414
33
12
9.0
3.0
3,143
3,341
3,465
198
125
6.3
3.7
12
2011
2010
2012
531
541
544
10
1.8
0.5
Other Products
1,685
1,717
1,863
32
145
1.9
8.5
Total Products
9,069
9,511
9,882
442
370
4.9
3.9
D EMAND
Other Non-OECD
PreliminaryestimatesforIndianoilproductdemandinJanuarypointtowardsdemandgrowthof2.7%
onayearonyearbasis.ThedemandexpansionhassubsidedtoitsweakestpacesinceJuly2011,asbig
declines in fuel oil (16.9%), naphtha (4.0%) and jet/kerosene (3.2%) outweighed the persistent gains
seen in gas/diesel oil (+7.6%) and gasoline (+1.6%). Gas/diesel oil is outpacing gasoline a trend
embeddedsincemid2011astherelativesubsidiesnowstronglyfavourdieselpropulsion.Thegasoline
priceinMumbai,asofmidFebruary,was70rupees/litre($1.42/litre)whereasdieselcostRs45.3/litre.
Withinour2012forecastfortotalIndianoildemandgrowthof3.2%,weareassumingdieselgrowthwill
outpacegasolineby5.0%to4.1%.Fueloildemandwillfallby0.4%in2012,asbunkerdemandfromthe
shippingindustryfallsback,partlyduetoabanonironoreexports.
kb/d
3,900
Y-o-Y
% Chg
5
3,700
3,500
3,300
3
3,100
2,900
2,700
1
2,500
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
2009
2010
2011
2012
EarlyindicatorsofRussiandemandin2012depictaresilientyearonyeargrowthrateofnearly4%for
January, with demand for motor gasoline dominating, up by 5.8%. The Russian demand picture is far
fromclear,aslargedeclineswereseeningasoil(4.5%),naphtha(4.5%)andjet/kerosene(4.3%).Such
wide discrepancies place an additional uncertainty burden on forecasts, but based on GDP growth of
3.5%,Russianoilproductdemandisexpectedtoriseby2.6%(+90kb/d)in2012to3.6mb/d.
kb/d
3,900
kb/d
900
3,700
850
3,500
800
3,300
750
3,100
700
2,900
650
2,700
600
S o urc e : P e t ro m a rk e t R G , IE A
2,500
S o urc e : P e t ro m a rk e t R G , IE A
550
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
Jan
Apr
Jul
Range 2007-2011
2011
Oct
5-year avg
2012
Jan
InBrazil,oildemandgrewby1.5%yearonyearinDecember,ledbyjetfuel/kerosene(+8.3%)andgasoil
(+2.9%).Motorgasolineremainedflatduringthemonth,maskingoffsettingmovementsfromanhydrous
ethanol to unblended gasoline (as the government reduced the ethanol requirement in the gasoline
blend,from25%to20%).TheBrazilianeconomyslowedattheendof2011,bringingannualGDPgrowth
to2.7%,notfaroffthe2.5%gainseeninoilproductdemand.Demandisexpectedtorisebyafurther
1.3%in2012,to2.8mb/donanassumptionof3.4%GDPgrowth.
13
D EMAND
200
100
Kb/d
20
90
60
30
0
-30
-60
-90
-120
10
-100
-10
-200
Apr 10
-20
Oct 10
Gasoline
Ethanol hydro
Apr 11
Oct 11
Exports
Imports
Source: ANP (Brazil)
1Q07
Ethanol anhydro
Motor gasoline (RHS)
90
60
30
0
-30
-60
-90
-120
The Brazilian motor gasoline mix in 2011 was composed of ethanol (23%), anhydrous ethanol (18%) and
petroleumrefinerysourcedgasoline(59%).SinceApril,thepoolshowedoffsettingshiftsbetweenethanol
andgasoline.Theformersawdemanddecreaseduetohigherprices,triggeredbyarelativeethanolscarcity.
Structural underinvestment in the ethanol industry,
Brazilian End-user prices
duringtherecessionof2008/2009,andlastyearsbad
US$/l
Motor gasoline-Ethanol Spread
weather conditions (suppressing the sugarcane
0.50
harvestof2011/12)werebothresponsibleforhigher
buy ethanol
ethanol prices. Magnifying the problem, sugarcane
0.25
supply constraints triggered higher prices for sugar
than ethanol, causing producers to maximize sugar
productionattheexpenseofethanoloutput.
(0.25)
Facinginflationarypressuresin2011,thegovernment
buy gasoline
sought to limit gasoline price pressures by
Source: ANP (Brazil)
(0.50)
encouraging the use of refined gasoline over more
rapidly appreciating ethanol. Specifically, the
government used a combination of reducing the
mandatory minimum ethanol blend, from 25% to 20%; balancing a complex structure of taxes; and
influencing Petrobras retail prices. Furthermore, the appreciation of the Brazilian currency, versus the
USdollar,madegasolineimportsrelativelycheaperthannationallyproducedethanol.Intheshortterm,the
policyworkedandmotorgasolinewassuppliedtothemarketatamoreaffordableprice;butforthelonger
term,currentmarketsignalsdistortinvestmentsintheethanolindustry.
Going forward transport fuel consumption will depend not only on the predicted slowdown in GDP and
vehicle sales. It will also depend on sugarcane/ethanol market dynamics and enduser price formation,
whicharehighlysusceptibletotaxesandblendingpolicies.The2012demandoutlooklookssluggish,with
the share of unblended gasoline in the Brazilian motor gasoline mix expected to remain unchanged and
largelydependentonimports.Furtherahead,itwilldependonthe2012/2013sugarcaneharvestandthe
commissioningofnewrefineryprojectsin2H13.
14
S UPPLY
SUPPLY
Summary
Global oil supply fell by 0.2mb/d to 90.4mb/d in February, with rising OPEC NGL and crude
production only partially offsetting a 0.5mb/d decline from nonOPEC countries. Compared to a
yearago,globaloilproductionstood1.7mb/dhigher,90%ofwhichstemmedfromincreasingoutput
ofOPECcrudeandNGLs.
NonOPEC supply fell by 0.5mb/d to 52.8mb/d in February. Supplies declined in all regions last
month but most notably in South Sudan and in Latin America. North Sea production continued to
falterin1Q12,fallingby0.3mb/dfrom1Q11,paringannualnonOPECsupplygainstoonly0.3mb/d.
ContinuedviolenceinSyriaandtheunresolvedtransitdisputebetweenSudanandSouthSudanare
theprimarycontributorstoa0.2mb/drevisiontononOPECsupplythismonth.Thisleavesgrowth
for2012at0.7mb/d,derivinglargelyfromtheAmericasandtheFormerSovietUnion.
OPECcrudeoilsupplyinFebruaryroseforthefifthmonthrunning,ledhigherbySaudioutputata
threedecade peak and a sharp recovery in Libyan production so far this year. Output rose by
315kb/dto31.42mb/d,thehighestlevelsinceOctober,2008.Februaryshighproductionlevelsled
toadeclineinOPECseffectivesparecapacity,to2.75mb/dfrom2.85mb/dinJanuary.Thecallon
OPECcrudeandstockchangefor2012hasbeenraisedby200kb/dforboth2Q12and3Q12,toan
averageof30mb/d,duetolowerforecastsuppliesfromnonOPEC.
Market attention has been focused on the potential disruption in Iranian crude flows in coming
monthsastheEUs1Julyembargonears,withindustryanalystsexpectingexportsofIraniancrudeto
ultimatelybecurtailedbyaround800kb/dto1mb/dfrommidyearonwards.However,almostallof
Iransbuyerswillinevitablyscalebackvolumesinordertoavoidfallingfoulofsanctions.
m b/d
Year-on-Year Change
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.5
Nov 10 Feb 11 May 11 Aug 11 Nov 11 Feb 12
OP EC Crude
OP EC NGLs
Non-OP EC
Total Supply
m b/d
62
m b/d
32.0
31.5
31.0
30.5
30.0
29.5
29.0
28.5
28.0
60
58
56
54
52
50
Jan 11
Jul 11
Jan 12
Non-OP EC
OP EC Crude - RS
Jul 12
OP EC NGLs
All world oil supply figures for February discussed in this report are IEA estimates. Estimates for OPEC
countries,someUSstates,andRussiaaresupportedbypreliminaryFebruarysupplydata.
Note:RandomeventspresentdownsiderisktothenonOPECproductionforecastcontainedinthisreport.These
events can include accidents, unplanned or unannounced maintenance, technical problems, labour strikes,
politicalunrest,guerrillaactivity,warsandweatherrelatedsupplylosses.Specificallowancehasbeenmadein
the forecast for scheduled maintenance in all regions and for typical seasonal supply outages (including
hurricanerelatedstoppages)inNorthAmerica.Inaddition,fromJuly2007,anationallyallocated(butnotfield
specific)reliabilityadjustmenthasalsobeenappliedforthenonOPECforecasttoreflectahistoricaltendency
for unexpected events to reduce actual supply compared with the initial forecast. This totals 200kb/d for
nonOPECasawhole,withdownwardadjustmentsfocusedintheOECD.
15
S UPPLY
MarketattentionhasbeenevenlyfocusedonthepotentialdisruptioninIraniancrudeflowsincoming
monthsastheEUs1JulyoilembargonearsandtheveryreallossofsuppliesfromnonOPECproducers
Syria, South Sudan, Sudan and Yemen. The call on OPEC crude and stock change for 2012 has been
raisedby200kb/dforboth2Q12and3Q12,toanaverageof30mb/d,due tolowerforecastsupplies
from nonOPEC. For 2012 as a whole, the call is raised by 200kb/d, to 30.1mb/d, but still around
0.5mb/dbelowthe2011average.
m b/d
32
m b/d
32
31
31
30
30
29
28
29
27
28
26
1Q
2Q
3Q
Jan
4Q
2 0 10
2 0 11
2 0 12
Entire series based o n OP EC Co mpo sitio n as o f January 2009
o nwards (including A ngo la & Ecuado r & excluding Indo nesia)
Mar
2009
May
Jul
2 0 10
Sep
Nov
2 0 11
Jan
2 0 12
Februarys threeyearhigh production levels led to a decline in OPECs effective spare capacity, to
2.75mb/dfrom2.85mb/dinJanuary.Thatsaid,thegroupscurrentsustainablecapacityof35mb/dis
on course to rise by 620kb/d, to 35.62mb/d, in 3Q12 as a number of new projects come onstream.
ProductioncapacityinAngola,LibyaandNigeriashouldpostacombinedincreaseof330kb/d,whileIraq
willaddafurther130kb/d.
TheincreaseinOPECproductioncapacitywilllikelybewellreceivedgiventheuncertaintiessurrounding
the impact new EU and US sanctions will have on overall Iranian supplies come this summer. Iranian
crudeproductionedgedlowerby50kb/d,to3.38mb/dinFebruary.Already,sanctionsofthecountrys
CentralBankarehavingapronouncedimpactonIraniancrudetradepatterns.
kb/d
1200
mb/d
3000
3.9
1000
2500
3.8
800
2000
3.7
600
1500
400
1000
200
500
3.6
3.5
3.4
0
Jan-11
Apr-11
Jul-11
Total - RHS
OECD PAC
Other Non-OECD
Oct-11
3.3
Jan-12
Jan
OECD EUR
China / India
Mar
2009
May Jul
2010
Sep Nov
2011
Jan
2012
While a number of European countries have reportedly already halted imports of Iranian crude, latest
shippingdatashowotherbuyerssuchasIndiaandSouthKoreasharplyincreasedpurchasesinJanuary.
ChinahasalsohalveditsimportsfromIran,from550kb/dinDecemberto275kb/dinJanuary,duetoa
dispute over price terms, which has now been resolved. However, some of Irans traditional buyers
reportedlyhavebeenabletosecurebettercredittermsfromNIOC,which,ineffect,provideadiscount
16
S UPPLY
for lifters. Going forward, a number of European buyers have expressed concern that they will have
difficultyfindingreplacementbarrelsofsimilarqualitytoIransheaviercrudes,especiallyItalianrefiners
whoprocessthegradesforasphalt.Thistimeayearago,Europeanrefinersweresuddenlyconfronted
with similar concerns, but over the loss of light, sweet Libyan crude. Latest data show lighter Libyan
crudes were ultimately replaced with more imports of heavier, sour crudes from OPECs Middle East
producers(seeEuropeanRefinersTappedOtherOPECSupplytoReplaceLostLibyanBarrels).
Exports of Iranian crude could ultimately be curtailed by around 800kb/d to 1mb/d from midyear
onwards,onthebasisoftheEUembargoandassumingChina,India,JapanandSouthKoreacontinueto
purchaselowerlevelsofIraniancrude.Almostallofthecountryscurrentlifterswillinevitablyscaleback
volumesinordertoavoidfallingfoulofUSsanctions.Themostimmediateimpactsofarhasbeenonthe
shippingindustry,whichhasseenEUinsurancecompaniesannouncesuspensionofcoveragefortankers
that call at Iranian ports. Chinese vessels are largely the exception. State National Iranian Tanker Co
(NITC)hasalsoenlisteditsownvesselsfordeliveriestobuyersunabletosecureinsurancecoverage.Asa
result,thenumberofNITCvesselsavailableforfloatingstoragehasbeensharplyreduced.
OPEC Crude Production
(million barrels per day)
Capacity
Spare Capacity
vs Feb 2012
Supply
3Q12 Average
Sustainable
Production
Capacity
3Q12 Production
Capacity Versus
1Q12 Capacity
1.27
1.30
0.03
1.37
0.06
1.76
1.91
0.15
2.10
0.19
0.48
0.48
0.52
0.04
0.54
0.02
3.45
3.43
3.38
3.51
0.13
3.56
0.04
2.56
2.65
2.60
2.84
0.24
2.84
0.00
0.75
1.15
1.30
1.30
0.00
1.37
0.07
Nigeria
2.06
2.04
2.14
2.48
0.34
2.55
0.07
Qatar
0.82
0.82
0.81
0.90
0.09
0.90
0.00
Saudi Arabia
9.80
9.85
10.00
11.88
1.88
11.88
0.00
UAE
2.58
2.58
2.59
2.79
0.20
2.79
0.00
Venezuela4
2.38
2.47
2.48
2.60
0.12
2.63
0.03
27.92
28.46
28.81
32.02
3.21
32.51
0.49
Iraq
2.69
2.65
2.61
3.00
0.39
3.13
0.13
Total OPEC
30.61
31.11
31.42
35.02
3.60
35.63
0.62
Dec 2011
Supply
Jan 2012
Supply
Feb 2012
Supply
Algeria
1.29
1.29
Angola
1.75
1.70
Ecuador
0.48
Iran
2
Kuwait
Libya
OPEC-11
Sustainable
Production
1
Capacity levels can be reached within 30 days and sustained for 90 days.
Includes half of Neutral Zone production.
Nigeria's current capacity estimate excludes some 200 kb/d of shut-in capacity.
Includes upgraded Orinoco extra-heavy oil assumed at 410 kb/d in February.
2.75)
17
S UPPLY
Correspondingly, higher Saudi output in February reduced the countrys spare capacity to 1.88mb/d
from2.03mb/dinJanuary.Currentcapacityisestimated11.88mb/d.TheOMRdefinessparecapacityas
productionthatcanbebroughtonwithin30daysandsustainedfor90days.SaudiOilMinisterAliNaimi
hassaiditwouldtakethestateoilcompanyanadditional90daystobringonafurther700kb/d.Indeed,
Saudi Aramco in January was operating the highest number of rigs in four years as it restarts the
countrys oldest field, Dammam, and advances plans for the Manifa development. Both Dammam and
Manifa produce heavier crudes. Dammam, with a capacity of 100 kb/d, was mothballed 30 years ago.
Thefirst500kb/dstageofthe900kb/dprojectisexpectedtobebroughtonlinein2013.
FebruaryIraqicrudesupplywasdown35kb/dto2.61mb/d,curbedinpartbyexportconstraints.Crude
oil exports were off 35kb/d to 2.07mb/d, the lowest level since end2010. Crude shipments from the
southern port of Basrah were down by around 10kb/d to 1.7mb/d while northern exports of Kirkuk
crudefromCeyhanontheMediterraneanfellby25kb/d,to370kb/d.Aftermonthsofdelays,inearly
March Iraq loaded its first shipment from the newly inaugurated single point mooring (SPM) export
facilityintheGulf.However,itisstillunclearthevolumeofcrudethatwillbeexportedfromthenew
SPMinthemonthsahead,withreportsthefacilitystillhasnumeroustechnicalconstraints.Nameplate
capacityfortheSPMis900kb/dbutitisunlikelytoexceed250kb/duntilthesecondhalfoftheyear.
mb/d
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0
Jan-09
mb/d
2.4
2.2
2.0
1.8
1.6
Oct-09
Jul-10
Apr-11
1.4
Jan-09
Jan-12
Oct-09
Jul-10
Apr-11
Jan-12
NigerianoutputinFebruaryroseby100kb/d,to2.14mb/d,andhasnowrecoveredtothehighestlevel
in five months, when output reached 2.18mb/d last September. A wave of militant activity in recent
months reduced output to an average 2.05mb/d for December and January. The startup of the
Totaloperated180kb/ddeepwaterUsanfieldatendofFebruaryalsoboostedsupplies.Usan,amedium
sweetcrude,hasanAPIof30degreesandsulphurcontentof0.26%.Initialproductionwasmuchhigher
thanforecast,withseveralextracargoesofferedforApril.
AngolanproductioninFebruaryrose60kb/dto1.76mb/d.Productionisnowatthehighestlevelsince
April2010,thankstothesteadyrampupinproductionfromtheTotaloperated220kb/dPazflordeep
watercomplex.Startupofthe150kb/dPSVMfieldsisontrackfor3Q12.
18
S UPPLY
European Refiners Tapped Other OPEC Supply to Replace Lost Libyan Barrels
Prior to the onset of Libyas civil war, OECD Europe imported over 1.1mb/d of Libyas total 1.3mb/d of
crudeexports,sothelossofsupplieshittheregionsrefinersfarharderthanelsewhere.Withthebenefitof
afullofficial2011dataset,itisnowpossibletoquantifytheimpactofthelostLibyansuppliesuponcrudeoil
flowsintoOECDEurope.WhentheconflicteruptedinlateFebruaryLibyanexportstoOECDEuropedeclined
sharplybeforedryingupfromMayonwardswhileincrementalsuppliesfromothersourcesbegantoarrive
intheregionfromMarchonwards.Despitethearrivalofthesealternativesupplies,OECDEuropeimported
onaverage150kb/dlesscrudein2011thanin2010.
OECD Europe Crude Imports
kb/d
4000
3.0
3500
2.5
3000
% Sulphur
2500
2000
1500
1000
2.0
Libya
Iraq
Congo
Kirkuk
Arab Light
1.5
1.0
500
0
Jan-11
Arab
Medium
Arab Extra
Light
Brazil
Roncador
Es Sider
0.5
Apr-11
Jul-11
Saudi Arabia
Angola
Brazil
Bonny
Oct-11
Nigeria
Algeria
Colombia
0.0
28.0
32.0
Qua Iboe
36.0
API
Congo
N'Kossa
Saharan
Cusiana
Blend
Sarir
Bu Attifel
El Shahara
40.0
44.0
48.0
Thelight,sweetnatureofLibyancrudesandtheirhighyieldsofgasoline,lowsulphurdieselandjetfuellimited
the options for refiners to directly replace them with similar grades. It was previously noted (see Libyas
UprisingSeesOilSuppliesDwindleinOMR15March2011)thattheclosestqualityreplacementsforthelost
LibyanstreamsofEsSider,Sarir,ElShaharaandBuAttifelwereEkofiskandBrentcrudesfromtheNorthSea,
BTCBlendfromtheFSU,BonnyandQuaIboefromWestAfricaandAlgerianSaharanBlend.However,adding
tothetightnessinmarkets,anumberofthesestreamswerealsohitbyproductionproblemsin2011.Notably,
afteranoutagehityear,NorthSeaproductionwas350kb/dlowerin2011thanayearearlier,while2H11Azeri
fieldmaintenanceconstrainedsuppliesofBTCblendbyapproximately100kb/d.
TodealwiththeseextraconstraintsEuropeanrefinersturnedtoOPECmembersSaudiArabia,Nigeria,Iraq
andAngolatofillthegapbyincreasingsuppliesofmanycrudesalreadywidelyusedwithintheregion.By
comparingtheincrementalsupplies,whicharrivedinOECDEuropefromApriltoDecember2011withtheir
2010averages,itisapparentthattheseOPECmemberssuppliedacombined520kb/dofextracrude.Saudi
Arabia supplied the lions share of the increment at 200kb/d (including 160kb/d of Arab Light) while
Nigeria,IraqandAngolacontributed170kb/d,90kb/dand60kb/d,respectively.However,theSaudiand
IraqicrudesweresourandthusnotdirectreplacementsforlostLibyanstreams;thisthereforelimitedtheir
useaslikeforlikereplacementswithinmanysimpleEuropeanrefinerieswithoutdesulphurisationcapacity.
Incremental Nigerian and Angolan supplies were likely light, lowsulphur grades such as Bonny Light, Qua
Iboe and Girassol but these were not imported in quantities sufficient to replace light Libyan streams.
AlgeriainitiallyuppedsuppliesoftheexceptionallyhighqualitySaharanBlendduring2Q11butvolumeshad
droppedoffby4Q11.
Thisscarcityoflight,sweetcrudesandtherelatedincreaseinsweetsourdifferentialsdrewinunexpected
longhaulnonOPECsupplies.Forexamplebytheendoftheyear80kb/dofColombianCusianawasbeing
importedtoEuropewhilstpreviouslyonlytheoddspotcargohadbeenusedintheregionsrefineries.One
factorfortheincreasedvolumesofLatinAmericancrudesbeingshippedtoEurope,especiallyduring3Q11
was the IEA Libya Collective Action, as the release of 30 mb of light, sweet US SPR crude likely displaced
othersweetcrudesfromtheUSGulfcrudeslatewhichwerethenshippedtoEurope.
NowthattheLibyanconflicthasendedandcrudeproductionisbeingrampedup,flowsintoEuropeareonce
again looking similar to 2010 as imports of Middle Eastern sour crudes have fallen back to their previous
levels.However,itisinterestingtonotethatimportsoflight,sweetWestAfricanandLatinAmericancrudes
haveheldupabovetheir2010volumes,signallingthatEuropeisstillseekingdistillaterichgrades.
19
S UPPLY
Non-OPEC Overview
NonOPECoilproductionisestimatedtohavefallenby0.5mb/dto52.8mb/dinFebruary,largelydueto
weather and mechanicalrelated field outages in the North Sea and Canada, continued unrest and
additionalsanctionsinSyria,pipelinesabotageandlabourstrikesinColombiaandYemen,andthetransit
disputebetweenSudanandSouthSudan.ThelatterdisputeislikelytodentnonOPECoutputin2012by
around280kb/dcomparedto1H11levels.Theseunplannedshutinstotalmorethan750kb/din1Q12.
DespitemuchpessimismaboutnonOPECsupplygrowth,productionin1Q12isstillexpectedtogrowby
around 300kb/d and by around 730kb/d for the entire year. Weatherrelated and mechanical issues
continuetohinderoutputintheNorthSea,especiallyinDenmarkandtheUK.Newoutagesatoilsands
facilitiesinCanadaaswellaspipelinesabotageinColombiaareexpectedtomitigatethestronggrowth
inotherpartsoftheAmericas,especiallyinlighttightoilplaysintheUS.
mb/d
300
200
100
0
-100
-200
-300
-400
-500
mb/d
1.2
0.9
0.6
0.3
0.0
-0.3
-0.6
1Q11
NAM
China
PG & Biofuels
3Q11
1Q12
OECD EUR
Other Asia
Other
3Q12
FSU
LAM
Total
1Q11
3Q11
1Q12
3Q12
Crude
NGL
Processing Gains
Non-conv
Global Biofuels
Total
ButtheworseningprospectsandhighuncertaintyconcerningSouthSudansandSyriasoutputwilllikely
have the largest effect on nonOPEC supply in coming months. This outlook assumes that Sudan and
South Sudan will still contribute 180kb/d to nonOPEC output (half of which is from South Sudan)
assumingthatsomeproductionisrestartedby2H12givensevereeconomicpressures.Thisoutlooknow
also assumes a gloomier scenario in Syria than last month in which production falls by 150kb/d to
averageonly180kb/din2012.Amorepessimisticscenario,yetnotoutoftherealmofpossibility,which
leaves South Sudanese output at minimal levels, shows no improvement for Yemens outlook in 2012
from current levels, and constrains Syrian production to around 100kb/d, would cut overall nonOPEC
outputgrowthin2012by150kb/dto590kb/d.
Revisions for 2011 centre upon delayed data for Azerbaijan, Indonesia, Malaysia, and Africa. These and
other baseline revisions result in an overall downward revision of 90kb/d in 4Q11 to 53.1mb/d. 2011
nonOPEC supply growth is revised downwards by less than 10kb/d to 130kb/d. In addition to the
worsening outlook in the Middle East and Africa, North Sea production continues to underperform
expectationsin1Q12byaround90kb/d,averaging3.0mb/d,andacceleratingtheyearonyeardeclineto
330kb/d.Insum,nonOPECsupplygrowthiscutby200kb/dfor2012to53.4mb/d,withtheUSasthe
onlybrightspot.
OECD
North America
US January preliminary, Alaska and North Dakota actual, other states estimated: Based on
preliminary weekly data, US crude oil supply fell slightly to 5.8mb/d in January. A small fire at the
PrudhoeBayfieldreducedoutputbyaround50kb/dforacoupledays,butoutputhasquicklyreturned
to average levels of 350kb/d. The decline in Alaska in January was mostly offset by rapidly increasing
production in light tight oil plays, especially in North Dakota and Texas. We have revised upwards the
20
S UPPLY
forecast for Texas production to take into account increased drilling activity in the Eagle Ford and
Wolfberryplays.TheTexasandneighbouringNewMexicoplaysarebeingtappedquicklyinthecurrent
high price environment because the resources have already been comprehensively explored and
takeawaycapacityisfarlessconstrainedthanintheBakken.
mb/d
1.0
mb/d
0.8
3.9
0.6
3.7
0.4
3.5
0.2
3.3
0.0
3.1
-0.2
2.9
-0.4
1Q11
Alaska
Other Low er-48
Other
3Q11
1Q12
3Q12
California
Gulf of Mexico
Total
Texas
NGLs
Jan
Mar
May
2008
2010
2011 forecast
Jul
Sep
Nov
Jan
2009
2011
2012 forecast
Canada December actual: Canadian oil output reached an alltime record of 3.8mb/d in December
2011, but unplanned outages have reduced synthetic crude production by 50kb/d in 1Q12 from the
priorquarter.CNRLs110kb/dHorizonupgraderwasshutdownforrepairsandwillnotreturntoservice
untilmidtolateMarch(fourweekslaterthaninitiallyexpected)accordingtotheoperator.Inaddition,a
coking unit at Canadian Oil Sands Syncrude facility was shut down in February, reducing the 300kb/d
facilitysoutputbyaround100kb/d.Finally,Enbridgeidleda318kb/dcrudeoilpipelineforseveraldays
afteratrafficcollisionnearapumpingstation.ThelinecarriesCanadianoiltoIndianaviathealready
backedupSuperior,Wisconsinpoint.TheincidentstimingwasfortuitousasCanadiansyntheticoilflows
werealreadylowerbecauseoftheunplannedoutagesmentionedabove.Theseincidentshaveresulted
ina20kb/drevisionforCanadianoilproductionfor2012,whichnowaverages3.7mb/d,comparedto
3.5mb/din2011.Lookingforward,Canadasoutputisassumedtobereducedbyanaverageof50kb/d
in each month for random supply shortfalls as part of the 200kb/d nonOPEC supply allowance. In
addition, beginning with last months outlook we assume that on an annual basis mining and in situ
projectoutputisotherwisereducedbyanadditional35kb/dforplannedandunplannedmaintenance.
North Sea
Weather,unplannedandplannedmaintenance,andotherpipelineoutagescontinuetoplagueNorthSea
production in 1Q12. During the first half of last year, unplanned outages in the North Sea averaged
90kb/d curbing output to 3.2 mb/d, its lowest level on record. Many of the problems from that time
have now been resolved, which we expect to prop up the annual trend slightly. For the remainder of
2012, field underperformance and some project slippage will reduce North Sea crude and condensate
outputandhavealreadyresultedindeferredloadingsinApril.Someoperatorsarealreadyannouncing
summer maintenance plans, but are also indicating that other maintenance will occur in the spring,
slightlyearlierthan expected.WithweatherrelatedshutinsandmaintenanceinDenmarktoo,output
from the North Sea in 2012 is expected to fall by 0.14 mb/d (or 4.6%) to 2.9 mb/d. These estimates
assume that maintenance losses in Norway and the UK in 2Q12 and 3Q12 are around 40kb/d greater
thanlastyear,reducingoutputlevelsby190kb/d.
21
S UPPLY
Norway January preliminary, December actual: Production fell by around 10kb/d in January from
December2011toaverage2.0 mb/d, around120kb/dloweryearonyear. The Gja,Tyrihans, Morvin,
and Volve fields all turned in lacklustre performances in the last couple months of 2011, and we have
adjusted our outlook downwards for those fields in 2012. Unplanned maintenance at Statfjord has cut
production by over half to around 20kb/d in March. Also, shareholders of the 40kb/d Yme field
announcedyetanother612monthdelayinstartupto2013,whichcontributedtothe40kb/drevision
toNorways2012liquidsestimate.Thisnowaverages2.0mb/din2012,around80kb/dlowerthan2011.
mb/d
mb/d
2.7
1.6
2.5
1.4
2.3
1.2
2.1
1.0
1.9
1.7
0.8
Jan
Mar
May
2008
2010
2011 forecast
Jul
Sep
Nov
Jan
2009
2011
2012 forecast
Jan
Mar
May
2008
2010
2011 forecast
Jul
Sep
Nov
Jan
2009
2011
2012 forecast
UKDecemberpreliminary,Novemberactual:Crudeoilproductionisexpectedtofallby14%annually
in 1Q12 to 960kb/d, which is slightly steeper than last years annual decline from 1Q10. Although we
remain three months away from a full set of fieldspecific data for 1Q12, we assume that Buzzards
productionaveraged170kb/din1Q12,whichisaround40kb/dbelowcapacityandissupportedbythe
operators statements to the media about daily production levels. Because of continuing performance
problemsatthisandotherfields,UKliquidsproductionisaveragingaround1.1mb/din1Q12,around
10kb/dlessthan4Q11.PlannedmaintenanceislikelytobegininlateMarchandrununtiltheendofthe
summer,whichwillkeep UK productionatanaverageof1.1mb/dfortheyear,afallofaround4.4%.
Rebounding production from the Forties system (largely Buzzard) and West of Shetlands (from
Schiehallion)andtheadditionoftheAthenafieldinlate2Q12(afteradelayeddeliveryoftheFPSO)will
mitigatefallingproductionatmaturefieldsthatweassumearedecliningatratesof1522%.
DenmarkJanuaryactual:Danishcrudeoilproductionfellto190kb/d,itslowestlevelssincethemid
1990s in December 2011 and contributed to overall lower North Sea output. January saw only a small
improvement. Production should return to 210kb/d in 2Q12, which is still an average 11% lower than
last year, but will fall again in August as maintenance will shut in the 10kb/d Tyra East field. The
shutdownwillalsoaffectaround20kb/dofproductioninNorway.
Other OECD
Mexico January actual: Production at the KMZ and Cantarell fields fell in January, lowering Mexican
crude output by 40kb/d to 2.5 mb/d. These fields sustained and even increased production levels in
2011throughincreased drillingonshoreandthrough EORtechnologiesat shallowwaterfields,leaving
Mexicancrudeproductionin2011only0.6%lower.Maturefielddeclineselsewhereandalackofnew
projectswillreduceproductionby3.3%to2.5mb/dthisyear.Pemexplanstoincreaseitsdrillingactivity
inthe GulfofMexiconearthePerdidofoldbelt(closetothePerdidoandGreatWhitefields),but the
companystilllacksexperienceindrillingforoilatdepthsbeyond6400metres.Thatisonlyalittlemore
than half the depth to which the US fields had been drilled. In such a remote area of the Gulf,
infrastructurechallengesarelikelytoslowdevelopment.
22
S UPPLY
Non-OECD
Former Soviet Union
In the Caspian, production fell more sharply than anticipated in Azerbaijan in 4Q11 to 760kb/d, the
lowestlevelsince4Q08,duetomaintenanceattheAzeriChiragGuneshli(ACG)field.Weexpectsome
uptickinproductionin1Q11asthismaintenanceiscompleted,butaslowerreturntonormalratesthan
lastmonthfromalowerbaseline.Asaresult,Azerbaijaniproductionin2012isreviseddownwardsby
10kb/dto990kb/d,or60kb/dhigherthan2011.InKazakhstan,TengizChevroilrecentlyindicateditwill
carryoutmaintenanceatafieldprocessinglineduring2Q12(reducingoutputbyaround80kb/d)andin
August at its 300kb/d Second Generation Project. Maintenance also reduced output by as much as
70kb/dattheKarachaganakfield.Overall,Kazakhstansoutputshouldfallbyaround1.0%or20kb/din
2012to1.6mb/dlargelyunchangedfromtheforecastlastmonth.
Russia February actual: Data for February show liquids production unchanged at January levels of
10.6mb/d.GazpromscondensateoutputfellslightlyinFebruaryfromJanuary,butincreasedproduction
from Rosnefts Vankor and PSA output offset the decline. The Vankor field is now producing almost
340kb/d,comparedto280kb/datthesametimelastyear.Onaverage,JanuaryandFebruarylevelsare
1.1%higherthantheprioryearslevels.Wemaintainthatincreasingcondensatevolumes,risingoutput
fromEasternSiberiangreenfields,andsustainedoutputatbrownfieldsamidthishighpriceenvironment
will contribute to a 1.2% increase in Russian liquids supply in 2012, averaging 10.7mb/d versus
10.6mb/din2011.
kb/d
500
400
300
200
100
0
-100
-200
-300
kb/d
400
300
200
100
0
1Q09
2Q09
3Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
-100
1Q09 3Q09 1Q10 3Q10 1Q11 3Q11 1Q12 3Q12
Azerbaijan
Turkmenistan
Kazakhstan
Uzbekistan
Novatek
Gazprom
FSU net exports rose by 440kb/d to 9.2mb/d in January driven by a significant 400kb/d increase in
productshipments.Crudevolumesrosebyamarginal10kb/dafterareboundinCaspianexportsoffset
a20kb/ddecreaseinTransneftflows.DeliveriesofTurkmenandAzerbaijanioilthroughtheBTCpipeline
increasedby50kb/dto700kb/duponthecompletionofmaintenanceattheACGcomplex.CPCflows
increased by 40kb/d to 650kb/d following rising production at the Tengiz field but volumes remain
approximately 150kb/d below peak levels due to constraints resulting from Phase 1 of the CPC
expansionproject.IncreasedCPCflowsoffsetdeclineselsewhereintheBlackSeaastheUkrainianports
fell out of favour with exporters. Cargoes sent via Primorsk rebounded by 50kb/d after completion of
maintenance on the BPS pipeline with the rise being equally split between Russian and Kazakhstani
crudes.Elsewhere,Druzhbapipelineflowsfellby40kb/dafterlessRussianUralswasdeliveredtoPoland
andshipmentsofESPOfromKozminoincheddownby20kb/d.
Increasing refinery runs, coupled with a seasonal dip in demand, were the primary drivers for the
exceptional400kb/dhikeinproductsshipments,withexportsoffueloil,gasoilandothergasoilgrowing
by180kb/d,150kb/dand60kb/d,respectively.Reboundingdomesticdemand,additionalmaintenanceat
Primorsk,andcoldweatherlikelyreducednetproductexportsinFebruary.
23
S UPPLY
2010
2011
Nov 11 Dec 11
Jan 12
Crude
Black Sea
2.10
1.93
2.06
1.87
1.87
1.92
2.05
1.85
1.83
-0.02
Baltic
1.60
1.50
1.48
1.57
1.37
1.56
1.68
1.48
1.53
0.05
-0.35
0.11
Arctic/FarEast
0.74
0.67
0.70
0.69
0.65
0.65
0.60
0.63
0.63
0.00
-0.05
BTC
0.77
0.70
0.72
0.76
0.69
0.64
0.61
0.64
0.69
0.05
0.06
Crude Seaborne
5.22
4.80
4.96
4.89
4.58
4.77
4.94
4.60
4.68
0.08
-0.22
Druzhba Pipeline
1.13
1.17
1.14
1.12
1.18
1.24
1.24
1.28
1.23
-0.04
0.08
Other Routes
0.42
0.53
0.53
0.54
0.54
0.50
0.49
0.52
0.50
-0.02
-0.01
6.76
6.50
6.63
6.55
6.30
6.51
6.68
6.40
6.41
0.01
-0.15
4.00
4.18
4.15
4.16
4.09
4.31
4.48
4.22
4.21
-0.02
0.07
Products
Fuel oil2
1.54
1.58
1.43
1.82
1.59
1.46
1.50
1.44
1.62
0.18
0.19
Gasoil
0.88
0.77
0.90
0.79
0.72
0.69
0.69
0.67
0.83
0.15
-0.08
Other Products
0.43
0.43
0.48
0.53
0.36
0.33
0.27
0.37
0.44
0.06
0.00
Total Product
2.85
2.77
2.81
3.14
2.66
2.49
2.47
2.48
2.88
0.40
0.12
Total Exports
9.61
9.27
9.44
9.68
8.96
9.00
9.15
8.88
9.29
0.41
-0.03
Imports
0.07
0.09
0.08
0.08
0.10
0.08
0.07
0.11
0.08
-0.03
0.00
Net Exports
9.55
9.18
9.37
9.60
8.86
8.91
9.08
8.77
9.21
0.44
-0.03
Latin America
Brazil January actual: Brazilian crude and condensate production rose an additional 15kb/d to record
levels of around 2.2mb/d in January. New wells lifted Marlim Sul production by 40kb/d to 310kb/d. In
November2011,thefieldsP40platformsufferedagasleak,butitsproductiononlyfellbyaround10kb/d
to65kb/dinthatmonth.PetrobrasannouncedasecondgasleakatthefieldinearlyMarchatthe180kb/d
capacityP51platform.Thecompanyreportedthatitwasconductingscheduledmaintenanceatthetime.
WeexpectthistohaveanegligibleaffectonMarlimSulsoutputbecauseofotherincreases.Inaddition,at
thebeginningofFebruaryPetrobrasannouncedthatoilandgasproductionatCariocaNordeste,apresalt
field,wouldbedownforaround60days.Thefieldhadbeenproducingaround12kb/dduring4Q11during
anextendedwelltest.Theseincidents,alongwithaminordownwardrevisiontoBrazilNGLoutput,have
contributedtoa10kb/drevisiontothe2012outlook.
24
S UPPLY
Asia
Liquidsproductionrosetoalmostaround690kb/dinMalaysiainJanuary2012onrisingoutputfromthe
KikehandSepatfields.ThestrongoutputlevelsfromKikehhavebeencarriedthroughtheformerlymore
conservativeforecast,whichhasresultedina50kb/dupwardsrevision.Newfieldadditionsshouldraise
Malaysian output by around 20kb/d to 670kb/d in 2012 after mechanical issues at Kikeh dented the
countrysoutputin2011.Indonesiasoiloutputisexpectedtodeclineby7.1%to870kb/dthisyear,which
is a slight improvement from last months estimate. The +10kb/d revision to the yearonyear decline
stemsfroma2011upwardsrevisiontotakeintoaccountnewlyrevisedgovernmentdata.
Africa
Sudan&SouthSudan:Thecontinuingtransitdispute
Sudan and South Sudan Oil Output
500
SUDAN
between Sudan and South Sudan has removed
450
Total Exports
almost350kb/dfromworldoilmarkets,anditisthe
400
Source: Lloyd's
largest contributor to recent revisions to nonOPEC
Marine Itnelligence
350
300
supply estimates for 2012. The IEA focused on the
S.SUDAN
250
dispute in last months OMR, (see Sudan and
200
Chinese Imports
SouthSudan: Over a Barrel Again, OMR dated
150
Source: China OGP
100
10February2012) noting that average production
50
wouldbereducedby200kb/din1Q12.Historicaland
0
forecast production from these countries are highly
uncertain, with only anecdotal information, hearsay,
occasional government updates, and thirdparty
export statistics as sources. We revise upwards 4Q11 South Sudan production by 60kb/d to 340kb/d
from last months estimate based on updated export figures and higher Block 3/7 production during
2H11. We have also tempered expectations for a restart to this production in 2012, reducing
SouthSudans forecast by 90kb/d. We expect production will fall by 220kb/d in 1Q12 from the prior
quarter. Likewise, production in 2012 is expected to be 280kb/d lower than 1H11 when output was
proceedingnormally.NewsthatSouthSudanwouldbeginarrangementswithitssouthernneighboursto
truck some oil has only slightly mitigated the darkening outlook for the countrys oil production. We
assume that the country will be able to export increasing volumes of its crude by truck in upcoming
months. We acknowledge that the actual outcome could be much worse due to problems obtaining
trucks,problemswithrestartingquicklyshutinproductionorfurtherescalationofcrossborderconflict.
Infact,SouthSudanallegedthatSudanhadbombedtwooilfieldsintheUnityareainlateFebruary.All
told, combined production for the countries is now seen averaging 180kb/d in 2012 compared with
450kb/din2011.
Outside of Sudan and South Sudan, oil production is increasing gradually in nonOPEC countries. In
Ghana, Tullow recently reported that it had completed Phase 1 development at the Jubilee field in
October,bringingproductionratestoapeakof88kb/d,decliningtoaround70kb/dbytheendof2011.
The Government of Ghana approved the installation of five new producing wells (Phase 1A) early this
year.Weexpectproductionratestoaveragearound80kb/din2012,inthemiddleoftherangeofthe
companysforecast,withratesofaround90kb/dbyDecember2012and105kb/din2013.Tullowalso
reported that it had finally signed an agreement with the Government of Uganda on the continued
development of fields in Exploration Area (EA) 1 and at the Kanywataba prospect. The agreement
includes the farmdown of 2/3 of its shares to Total and CNOOC. Total will operate EA 1, Tullow will
operateEA2,andCNOOCwilloperatetheKanywatabaProspectAreaandtheKingfisherfield.Assuming
thisproductioncomesonlineonschedulein2013,productioncouldreachashighas140kb/dby2016.
Production from the Aseng field (in Block I in Equatorial Guinea) came online on 6 November 2011,
aheadoftheplannedstartupin1Q12.Thefieldsproductionreachedaround50kb/dattheendof2011
andhasincreasedmarginallyto55kb/din1Q12,bringingEquatorialGuineasproductionto290kb/d.
25
S UPPLY
Middle East
Yemens output averaged around 180 kb/d in 4Q11, around 120 kb/d below 2010 levels of 300 kb/d.
Production fared worse in 1Q12 and especially in February and is estimated to have dropped an
additional20kb/dto160kb/dfromthepriorquarter.ThecontinuedtargetingoftheMariboilpipeline,
whichflows270milestotheRedSeaportofRasIssa,hasfrequentlyshutinproductionatthefieldsin
Block18andhasrequiredthecountrytoimportrefinedproducts.InFebruary,afourdaylonglabour
strikeatTotalsBlock10compromised70kb/dofproduction,andaninedaylongstrikeinBlock14shut
in52kb/dofproductionaccordingtomediareports.ThesestrikesreducedYemensmonthlyaverageby
anadditional40kb/dtolessthan140kb/dinFebruary.Alltold,Yemensliquidsproductionisexpected
to fall by 50 kb/d to 180 kb/d in 2012 on the assumption that that 2Q124Q12 period sees modest
improvementscomparedtofirstquarterlevels.
Syrias liquids production is expected to fall by around 30kb/d to 170kb/d by December 2012, in a
marked decrease from last months expectations for a rebound to 2011 levels. The attacks on energy
infrastructure around Homs have continued although the government has appeared to gain ground
againsttheopposition.Despitethesegains,theoppositionislikelytocontinuetosabotagetheenergy
infrastructure,arguablymoreso.Inthemediumtolongterm,newproposedUSsanctionsagainstSyria
arelikelytotightenthescrewsonpotentialinvestmentintheenergysector.TheHouseForeignAffairs
committeeunanimouslypassedtheSyriaFreedomSupportAct(H.R.2106),whichstillrequirespassage
bythefullHouseandSenate.Thebill
Orders the US President to impose sanctions on parties making a single petroleum development
investment of over $5 million or a series of investments that are at least $2 million (and exceed
$5millionintheaggregate).
Directs the President to sanction entities that invest in the maintenance or expansion of refined
productproductioninquantitiesofmorethan$1million.
OrdersthePresidenttoimposesanctionsonentitiesthatsellrefinedproductswithavalueofmore
than$1million.
SanctionsentitiesthatfinanceorinsureanySyrianenergyshipmentsintooroutofthecountry.
Oman December preliminary: Oil production in Oman reached around 900kb/d in December and is
expected to average similar levels for 2012 as a whole. Enhanced oil recovery via steam flood at
OxysMukhaizna project and PDOs Harwheel miscible gas project will offset declines elsewhere in
comingyears.Inarecentinvestorpresentation,Oxyclaimedthatadditionalvolumesaresoontocome
fromadditionalsteamflooding.AccordingtonewlyreleaseddatabytheOmaniMinistryofOilandGas,
PDO(aconsortiumledbyShellbutwitha60%governmentshare)produced549kb/dofcrudeoiland
94kb/dofcondensatein2011,roughly73%ofthecountrysliquidsoutput.PDOrecentlynotedthatit
wouldbeturningtounconventionalresourcesinordertofulfilthegovernmentsrequirement tokeep
productionabove550kb/dforover10years.
26
OECD S TOCKS
OECD STOCKS
Summary
OECDindustrytotaloilinventoriesrosebyamuted13.6mbinJanuary,to2614mb.Thedeficitof
stocks versus the fiveyear average widened to 68.9 mb, from 39.3 mb in December. As a result,
absolute inventory levels have stood below the fiveyear average for seven successive months, and
well towards the lower end of the fiveyear range. However in terms of days of forward demand
cover, OECD commercial oil holdings remained 1.0 day above the fiveyear average, at 57.8 days,
albeitcoverhasdeclinedby1.4days,yearonyear.
Preliminarydataindicatea12.6mbdeclineinFebruaryOECDindustryinventories,comparedwitha
fiveyearaverage38.8mbdrop.Crudeoilinventoriesroseby5.4mbwhileproductholdingsdropped
by22.5mb.Middledistillatestocksledtheproductdecline,offby15.4mb.
mb
2,816
2,766
2,716
2,666
2,616
2,566
2,516
Jan Mar May
Jul
Range 2007-2011
2011
mb
Sep Nov
Jan
Avg 2007-2011
2012
Relative to Five-Year
200
150
100
50
0
-50
-100
-150
Jan 10
Jul 10
Jan 11
Pacific
Europe
Average
Jul 11
Jan 12
North Am erica
OECD
Crude Oil
Gasoline
Middle Distillates
Residual Fuel Oil
Other Products
Total Products
1
Other Oils
Total Oil
10.3
11.2
2.1
-1.0
-12.5
-0.3
5.4
15.4
Europe
Pacific
8.5
1.0
-6.5
0.3
-0.6
-5.9
0.5
3.1
-7.6
2.8
1.5
0.7
-4.9
0.0
2.6
-5.0
N. Am
Europe
Pacific
Total
N. Am
Europe
Pacific
Total
11.2
14.9
-3.0
-0.1
-18.1
-6.2
8.6
13.6
0.33
0.36
0.07
-0.03
-0.40
-0.01
0.18
0.50
0.27
0.03
-0.21
0.01
-0.02
-0.19
0.02
0.10
-0.25
0.09
0.05
0.02
-0.16
0.00
0.08
-0.16
0.36
0.48
-0.10
0.00
-0.58
-0.20
0.28
0.44
-0.04
0.09
-0.03
-0.02
-0.15
-0.11
-0.20
-0.35
-0.24
0.06
0.10
-0.04
-0.02
0.09
0.03
-0.12
-0.01
-0.02
-0.07
-0.01
-0.07
-0.18
-0.04
-0.23
-0.29
0.13
0.00
-0.07
-0.25
-0.20
-0.21
-0.70
Crude stocks rose seasonally by 11.2mb to 917mb, nonetheless marking a seventh straight month of
belowaveragereadings.CrudeholdingsinNorthAmericaandEuropeincreasedby10.3mband8.5mb,
respectivelywhilethePacificshowedadropof7.6mb.Lowerrefinerythroughput,affectedbyaseriesof
refineryclosuresandscheduledturnarounds,ledtoabuildincrudestocksinNorthAmericaandEurope.
27
OECD S TOCKS
Inthemeantime,productinventoriesfellby6.2mb,instarkcontrastwithafiveyearaverage23.9mb
build,increasingthedeficitagainstthefiveyearaverageto39.1mb,from9.0mbinDecember.Mostof
the product stock draw stemmed from Europe, where middle distillate stocks fell by 6.5mb. North
America showed a modest decline of 0.3mb while product holdings in the Pacific remained
virtuallyunchanged.
mb
mb
1,544
1,044
1,494
994
1,444
944
1,394
894
1,344
844
Jan Mar May
Jul
Range 2007-2011
2011
1,294
Jan Mar May
Jul
Range 2007-2011
2011
Sep Nov
Jan
Avg 2007-2011
2012
Sep Nov
Jan
Avg 2007-2011
2012
OECD stocks were revised 10.3mb lower for December, upon receipt of more complete monthly
submissions from member countries. This implies a steeperthanusual 53.4mb decline in December
inventorylevels,comparedwithpreliminaryestimatesofa40.8mbdrop.Downwardadjustmentswere
centred on North American crude oil and other oils stocks, which were revised down by 5.7mb and
6.7mb, respectively. Higherthaninitially estimated European middle distillate stocks provided a
partialoffset.
North America
Nov-11
Crude Oil
Gasoline
Middle Distillates
Residual Fuel Oil
Other Products
Total Products
1
Other Oils
Total Oil
0.6
0.0
0.0
0.0
0.0
0.0
1.0
1.5
Europe
Pacific
Dec-11
Nov-11
Dec-11
-5.7
-3.6
5.1
-3.3
-1.9
-3.6
-6.7
-16.1
-0.6
0.0
1.5
0.0
0.0
1.5
-0.1
0.8
-1.6
0.9
6.7
-0.3
0.4
7.8
-1.3
4.9
Nov-11
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
OECD
Dec-11
-0.3
0.3
0.5
0.0
0.2
1.1
0.0
0.9
Nov-11
0.0
0.0
1.5
0.0
0.0
1.5
0.8
2.3
Dec-11
-7.6
-2.3
12.4
-3.6
-1.2
5.3
-8.0
-10.3
Preliminary data indicate a 12.6 mb decline in February OECD industry inventories, compared with a
fiveyearaverage38.8mbdrop.Crudeoilinventoriesroseby5.4mbwhileproductholdingsplummeted
by22.5mb.Allproductstockcategoriesshoweddeclines,albeitfocusedonmiddledistillateinventories.
This category plunged by 15.4mb on strong demand for diesel and heating oil. Gasoline, fuel oil and
otherproductsholdingsalsofellby3.2mb,3.0mband0.9mb,respectively.
28
OECD S TOCKS
Meanwhile, product inventories edged down by 0.3mb as a sharp decline in other products holdings
outweighedanincreaseingasolinestocks.Otherproductsstocksfellby12.5mbontheincreaseduse
ofpropaneforheating,whilegasolineinventoriesroseby11.2mbduetolowerdemand.USpreliminary
datashowfourweekaveragegasolinedemanddeclinedtothelowestlevelsinceFebruary2001.Middle
distillate stocks rose by 2.1mb, as heating oil consumption was depressed by warmerthannormal
temperatures.
OECD North America Crude Oil
Stocks
mb
519
499
mb
799
749
479
459
699
439
649
419
399
Jan
Mar May
Jul
Range 2007-2011
2011
Sep Nov
Jan
Avg 2007-2011
2012
599
Jan
Mar May
Jul
Range 2007-2011
2011
Sep Nov
Jan
Avg 2007-2011
2012
US weekly data show oil inventories edged down by 0.2mb in February, compared with a fiveyear
average19.7mbdraw.Crudeholdingsroseby6.4mb,mostofwhichstemmedfromCushing,Oklahoma.
CrudelevelsatCushingsurgedby5.5mbto35.8mb,markingtheirhighestlevelsinceJune2011dueto
theSeawaypipelinepurgeaswellaslowerrefinerythroughputs.
US Weekly Total Industry Stocks
mb
mb
1,200
45
1,150
40
1,100
35
30
1,050
25
1,000
20
950
15
Source: EIA
900
Jan
Apr
Range 2007-2011
2011
Jul
Oct
5-yr Average
2012
Source: EIA
10
Jan
Apr
Jul
Range 2007-11
2011
Oct
5-yr Average
2012
USproductinventoriesfellby11.9mbinFebruaryonthebackofdeclinesacrosseveryproductcategory.
Middle distillate holdings took the lead, decreasing by 7.5mb. However, it was diesel stocks that
accountedformostofmiddledistillatesdecline,offby5.9mb.Heatingoilstocksedgeddownby0.6mb
onunusuallymildweatherintheNortheastregion.Gasolineinventoriesdeclinedby1.7mbasdemand
rosemonthonmonth,despiteremainingweak.Otherproductsandfueloilstocksalsofellby2.4mb
and0.3mb,respectively.
OECD Europe
Industry oil inventories in Europe rose by 3.1mb in January to 904mb, a milder increase than the
fiveyear average build of 21.1mb, thus widening the deficit versus the fiveyear average to 79.4mb
from61.5mbinDecember.Europeanstockshavethereforesetnewfiveyearlowsfornineofthelast
tenmonths(baringNovember2011)
Both lower refinery runs and higher regional output drove crude stocks up by 8.5mb, to 295mb.
However, they are still at the second lowest level since September 1997, and have stayed under the
fiveyear range for an eleventh straight month. At the same time, scheduled returns on loans from
Germanys stockholding agency, EBV, of at least 0.6mb of North Sea crude in January may have
contributedtoadownwardtrendinEuropeanindustrycrudeoilinventories.
29
OECD S TOCKS
In the meantime, European refined product holdings fell by 5.9mb in stark contrast with a fiveyear
average 20.6mb build. They fell below the fiveyear range for the first time since November 2007.
However,productstockslookcomfortablewhenmeasuredagainstforwarddemand,slightlyabovethe
fiveyearaverageat39.1daysofforwardcover.Middledistillatesledthedecrease,fallingby6.5mbon
strongdemandfordieselandheatingoil.Notably,German middledistillateholdingswerereportedto
havefallenby9.0mb.Incontrast,gasolineandfueloilholdingsroseby1.0mband0.3mb,respectively.
Meanwhile,Germanenduserheatingoilstocksfellby3percentagepointsto54%fillatendJanuary.
mb
mb
622
362
602
342
582
562
322
542
302
282
Jan
522
Mar May
Jul
Range 2007-2011
2011
502
Jan
Sep Nov
Jan
Avg 2007-2011
2012
Mar May
Jul
Range 2007-2011
2011
Sep Nov
Jan
Avg 2007-2011
2012
February preliminary data from Euroilstock point to a seasonal 3.9 mb stock draw, compared with a
fiveyearaverage10.9mbfallintheEU15andNorway.Bothcrudeoilandproductinventoriesfellby
0.7mband3.3mbrespectively.Middledistillateholdingsledthedecrease,decliningby2.5mb.Aswas
thecaseinJanuary,replenishmentofgovernmentagencystocksmayhavecontributedtothisdecrease,
with Frances agency purchasing 2.3mb of diesel. A 0.3mb decrease in industry gasoline stocks and a
1.4mbdeclineinfueloilholdingsalsocontributedtotheoverallproductstockdraws.Inthemeantime,
other products inventories rose by 0.9mb. Refined product stocks held in independent storage in
Northwest Europefell,onsharp drawsingasoline asexportstotheUnitedStatesandothercountries
rose.
OECD Pacific
January commercial oil inventories in the Pacific declined by 5.0mb to 385mb in contrast with the
fiveyearaverageincreaseof9.5mb.Thedeficitofinventoriesversusthefiveyearaveragewidenedto
27.5mb from 13.1mb in December, with oil stocks falling below the fiveyear range. Crude holdings
decreased counterseasonally by 7.6mb to 148mb, remaining under the fiveyear range for a fourth
consecutivemonth.Inthemeantime,productstocksremainedvirtuallyunchanged,asgainsingasoline,
middledistillateandfueloilstockswereoffsetbyadropinotherproductsholdings.However,products
stocks remain below their fiveyear range. Gasoline, middle distillate, and fuel oil holdings rose by
2.8mb,1.5mband0.7mb,respectivelywhileotherproductsstocksfellby4.9mb.
mb
mb
204
184
194
174
184
164
174
154
144
Jan
30
164
Mar May
Jul
Range 2007-2011
2011
Sep Nov
Jan
Avg 2007-2011
2012
154
Jan
Mar May
Jul
Range 2007-2011
2011
Sep Nov
Jan
Avg 2007-2011
2012
OECD S TOCKS
Japaneseindustryinventoriesdeclinedseasonallyby8.5mbinFebruary,accordingtoweeklydatafrom
the Petroleum Association of Japan (PAJ). Crude oil stocks fell by 0.3mb, likely on lower crude oil
imports.Productholdingsdecreasedby7.3mb,ledbyafallinkeroseneinventories.Anextremelycold
winterdrovekerosenestocksdownby3.2mb,tobelowthefiveyearrange.Theyhavebeenreducedby
more than 50% since November last year, dissipating the gradual stock build observed since the
catastrophic earthquake and tsunami in March 2011. Gasoline and fuel oil inventories fell by 1.2 mb
respectively,whileotherproductsstocksedgedupby0.7mb.
mb
mb
35
280
270
260
250
240
230
220
210
200
Jan
30
25
20
15
10
Source: PAJ
Apr
Jul
Range 2007-11
2011
Source: PAJ
5
Jan
Oct
5-yr Average
2012
Apr
Jul
Range 2007-11
2011
Oct
5-yr Average
2012
mb
20
15
10
5
0
(5)
(10) So urce: China Oil, Gas and P etro chemicals
Jul 11
Sep 11
Nov 11
Jan 12
Crude
Gasoline
Gasoil
Kerosene
*Since A ugust 2010, COGP o nly repo rts percentage sto ck change
60
55
50
45
40
35
30
25
20
Jan
Apr
Jul
Oct
R a nge 2 0 0 7 - 2 0 11
5 - yr A v e ra ge
2 0 11
2 0 12
Singapore onshore inventories surged by 6.0mb to 44.6mb in February, well above the fiveyear
averageof37.6mb.Fueloilstocksroseby2.3mbforasecondconsecutivemonth.Fueloilholdingshave
gained6.4mbsincetheirtwoandahalfyearlowinthemiddleofJanuary,duetorecordhighWestern
exports.Middledistillateinventoriesalsoincreasedby2.1mbonweakdemand.Demandforgasoiland
jet fuel in Asia remained subdued, while the arbitrage to send products to Europe remained closed.
Gasoline holdings rose by 1.6mb, to above the fiveyear range, as Malaysia and India, among others,
increasedgasolineexportstoSingapore.
31
OECD S TOCKS
Million Barrels
60
mb
1,450
58
1,400
56
1,350
North America
54
North America
1,300
52
1,250
50
48
1,200
46
1,150
Jan
Mar
May
Jul
Range 2007-2011
2011
Days
72
Sep
Nov
Jan
Jan
Mar
May
Jul
Range 2007-2011
2011
Avg 2007-2011
2012
mb
1,020
Europe
70
1,000
68
980
66
960
64
940
62
920
60
900
58
Sep
Nov
Jan
Avg 2007-2011
2012
Europe
880
Jan
Mar
May
Jul
Range 2007-2011
2011
Days
58
Sep
Nov
Jan
Jan
Avg 2007-2011
2012
440
52
420
50
400
48
46
380
44
Jul
Sep
Nov
Jan
Avg 2007-2011
2012
Pacific
360
Mar
May
Jul
Range 2007-2011
2011
Days
62
Sep
Nov
Jan
Jan
Avg 2007-2011
2012
Mar
May
Jul
Range 2007-2011
2011
mb
2,850
Sep
Nov
Jan
Avg 2007-2011
2012
2,800
60
2,750
58
2,700
56
2,650
54
2,600
52
2,550
2,500
50
Jan
May
mb
460
Pacific
56
54
Jan
Mar
Range 2007-2011
2011
Mar
May
Range 2007-2011
2011
Jul
Sep
Nov
Avg 2007-2011
2012
Jan
Jan
Mar
May
Range 2007-2011
2011
Jul
Sep
Nov
Jan
Avg 2007-2011
2012
1 Days of forward demand are based on average demand over the next three months
32
P RICES
PRICES
Summary
Oil futures prices moved higher in tandem with escalating supply side risks to the market in
February and early March. Geopolitical problems in Syria, South Sudan and Yemen have led to
protractedsupplydisruptionsfromthosecountries,removingfromthemarketmorethan600kb/d
in1Qthisyear.TheprospectofadditionalproductionoutagesrelatingtoIranhaveaddedyetmore
uncertaintyforthesupplyoutlookinthecomingmonths.FuturespricesforBrentwerelasttrading
around$125/bblandWTIat$106/bbl.
AstensionsintheMiddleEastspurredpricestoaninemonthpeak,openinterestinoilderivatives
increasedinFebruary,despitelingeringuncertaintiesregardingthehealthoftheglobaleconomy.
Money managers increased their bets on rising oil prices, to the highest levels observed since
May2011,triggeredbygrowingconcernsoverIransnuclearprogramme.
Markets for distillates and fuel oils softened with the end of peak winter season and as earlier
tightness on the product supply side eased. Crack spreads fell for middle distillates and fuel oils in
Februaryonweakerfundamentals,withproductpriceslaggingthesharpincreaseincrudemarkets.In
contrast,gasolinecrackspreadscontinuedtoshowstrength,althoughnarrowingfrom theelevated
levelsseeninearlyFebruary.
DespitebuoyantdemandforMiddleEasterncrudesinAsia,notablyfromChina,vesseloversupply
againweighedheavily,withfreightratesonthebenchmarkMiddleEastGulfJapanroutetrading
flat from mid February onwards. Although rates remain better than the dire levels seen in 3Q11,
surgingbunkerpriceshavecappedearnings.
$/bbl
Crude Futures
Front Month Close
$/bbl
130
128
9March2012
120
124
110
120
100
116
90
112
80
108
70
Feb 11
104
May 11
Aug 11
NYMEX WTI
Nov 11
Feb 12
ICE Brent
M1 2
NYMEX WTI
9 10 11 12
ICE Brent
Market Overview
February oil futures prices moved higher in tandem with escalating supply side risks to the market.
Formidable geopolitical problems in Syria, South Sudan and Yemen have led to protracted supply
disruptionsfromthosecountries,removingjustover600kb/dfromthemarketonaveragein1Q.Total
nonOPEC unplanned outages, which include the North Sea, equal around 750 kb/d for 1Q12. The
prospectofadditionalsupplylossesrelatingtothecrisiswithOPECssecondlargestproducer,Iran,have
addedyetmoreuncertaintyforthesupplyoutlookincomingmonths.
Oil futures at writing were trading near the 2011 highs posted at the onset of the Libyan crisis in late
February,withBrentpricesaround$125/bblandWTIabout$106/bbl.Monthonmonth,Brentfutures
rose by $7.61/bbl, to an average $119.06/bbl in February, gaining a further $6/bbl in earlyMarch.
14 M ARCH 2012
33
P RICES
USWTI saw smaller increases over the same period, largely due to rising crude oil stock levels at the
Cushing, Oklahoma delivery point for the NYMEX contract, up just under $2/bbl for the month, to an
average$102.26/bblinFebruary.
Dated Brent
US$
150
Euro
120
160
80
125
US$
180
Euro
100
100
140
100
60
120
75
40
100
80
60
40
80
20
50
25
Jan08
40
Jan08
0
Jan09
Jan10
US$/Bbl
20
60
Jan11
Jan12
Euro/Bbl
Jan09
Jan10
US$/Bbl
Jan11
Jan12
Euro/Bbl
Indeed, crude oil prices posted record highs in euro denominated terms, eclipsing the peak reached
during the 2008 price spike. Priced in euros, Brent crude hit a peak of 94.65/bbl in the first week of
March, the highest level since mid2008. Comparatively, since the first week of January 2009 Brent
priced in euros have doubled, while prices in dollars moved up by nearly 88%. Spot European gasoil
prices during the same period more than doubled in euro terms while in dollars they were higher by
almost89%.
Given the existing major debt issues facing beleaguered euro zone economies, the latest jump in oil
pricesaddsunwelcomeinflationaryandbalanceofpaymentscostswithimportsofdollardenominated
oil.Sustainedhigherpricesriskfurtherunderminingthepaceofglobaleconomicrecovery,bothdirectly
and indirectly curbing oil demand growth. Global oil demand growth is largely left unchanged in this
monthsOMR,at800kb/dfor2012,althoughfurthermacroeconomicimpactsderivingfromsustained
higheroilpricesarealsopossible.
US$/bbl
120
110
US$/bbl
120
Index
70
110
75
100
90
1300
90
1200
80
80
85
60
1000
Jan 10 Jul 10 Jan 11 Jul 11 Jan 12
90
Jan 11
Jul 11
Jan 12
N Y M E X WT I
US D o lla r Inde x ( inv e rs e d R H S )
1100
70
70
1400
100
80
Jul 10
Index
1500
So urce: NYM EX
60
Jan 10
NYM EX WTI
Thatsaid,itissupplysideissuesthatarecurrentlydominatingmarketsentiment.Geopoliticalissuesin
SouthSudan,SyriaandYemencombinedwithweatherrelatedandtechnicalproblemsintheNorthSea
andCanadahaveknockedaround750kb/doutofthemarketsofarin2012.
Inaddition,OECDcrudeoilinventoriesarestillhoveringatthebottomofthefiveyearaveragedespite
thehighestlevelsofOPECproductioninmorethanthreeyears.Indeed,latestdatashowOECDEurope
andPacificstocksarewellbelowthefiveyearrange.SeveralOPECproducershaveraisedsuppliesinthe
faceofhigherprices.InFebruary,SaudiArabiasoutputhitthe10mb/dmark,thehighestlevelinthree
decades,whileLibyanproductionreachedasignificant1.3mb/d,just300kb/dbelowlevelsregistered
priortolastyearscivilwar.
34
14 M ARCH 2012
P RICES
New international sanctions have so far had a minimal impact on actual Iranian crude supplies to the
market, with volumes in the JanuaryFebruary period off only about 75 kb/d from end2011 levels.
However, even before additional sanctions were announced in January, Iranian supplies were around
150200kb/d lower since last October/November, largely due to payment issues with customers.
Nonetheless,expectationsthatexportscouldplummetbybetween800kb/dand1mb/dinthesecond
half of the year have injected a high degree of uncertainty over the 2012 supply outlook. Though still
considered unlikely at this stage, the threat of disruptions
Crude Futures
to traffic through the Strait of Hormuz cannot be $/bbl
Forward Spreads
discountedentirely.
10
8 Source: ICE, NYMEX
6
Brents backwardation widened in February but eased
4
againinearlyMarchastensionsoverIranratchetedanotch
2
lower. The Brent M1M12 backwardation was running at
0
$7.45/bblinearlyMarch,comparedwitharound$6/bblin
-2
Februaryand$3.65/bblinJanuary.
-4
-6
Feb 11
May 11
Aug 11
Nov 11
Feb 12
The WTI M1M12 contract briefly moved into
WTI M1-M12
Brent M1-M12
backwardation in early March, when prices surged over
unfoundedrumoursaboutasupplydisruptioninSaudiArabia,beforeeasingagainundertheweightof
ample supplies in the US. The WTI M1M12 spread was averaging about $0.50/bbl in early March,
comparedwithamonthlyaverageof$1.85/bblinFebruaryand$0.18/bblinJanuary.
Prompt Month Oil Futures Prices
(monthly and weekly averages, $/bbl)
Dec
NYMEX
Light Sweet Crude Oil
98.58
RBOB
109.14
No.2 Heating Oil
122.13
No.2 Heating Oil ($/mmbtu)
20.97
Henry Hub Natural Gas ($/mmbtu)
3.25
ICE
Brent
107.72
Gasoil
124.05
Prompt Month Differentials
NYMEX WTI - ICE Brent
-9.15
NYMEX No.2 Heating Oil - WTI
23.56
NYMEX RBOB - WTI
10.57
NYMEX 3-2-1 Crack (RBOB)
14.90
NYMEX No.2 - Natural Gas ($/mmbtu 17.72
ICE Gasoil - ICE Brent
16.32
Source: ICE, NYMEX
Jan
100.32
117.45
127.94
21.96
2.71
Feb
Feb-Jan
% Week Commencing:
Avg Chg Chg 06 Feb 13 Feb 20 Feb
27 Feb 05 Mar
102.26
126.41
134.17
23.03
2.53
1.94
8.96
6.23
1.07
-0.18
1.9
7.1
4.6
4.6
-7.2
98.51
124.47
133.91
22.99
2.48
101.80 107.43
126.54 130.46
133.69 137.79
22.95
23.65
2.53
2.61
107.54 106.31
133.01 137.94
135.87 135.73
23.33 23.30
2.51
2.32
111.45 119.06
128.54 134.66
7.61
6.11
6.4
4.5
117.05
133.87
118.94 122.74
134.27 137.65
123.65 124.26
137.04 137.71
-18.54
35.40
25.97
29.11
20.50
16.82
-17.14
31.89
24.74
27.12
20.42
15.33
-16.10
28.33
25.47
26.42
20.82
13.39
-11.13
27.62
17.13
20.63
19.26
17.09
-16.80
31.91
24.14
26.73
20.51
15.60
-5.66
4.28
7.01
6.10
1.25
-1.50
-15.31
30.36
23.03
25.47
21.04
14.91
-17.95
29.42
31.63
30.89
20.98
13.44
Futures Markets
Activity Levels
TheratioofBrentfuturesinLondonICEtoNewYorkandLondonWTIoildeclinedto54.4%intheweek
ending 6 March from a historically high of 57.8% observed in January, triggered by a relatively large
increase especially in NYMEX WTI open interest. Meanwhile, ICE WTI open interest gained some
momentumafterdecliningforsixstraightmonthsstartinginOctober.ThedeclineintheratioofBrentto
WTIopeninterestissharperwhen ICEWTIcontractsareexcluded. TheratioofICEBrenttoCMEWTI
openinterestdeclinedto67.7%fromitspeakof73.3%registeredon24January2012.
14 M ARCH 2012
35
P RICES
AmidmountingconcernaboutsupplyoutagesaswellassanctionsonIranianoilsupplyandfearsabout
the Strait of Hormuz, money managers increased their bets on rising WTI crude oil prices by
55471contracts to reach 228 392 contracts in February, the highest since May 2011. However, in the
weekending6March2012,theyreducedtheirlongpositionby18857to209535contractsinresponse
to the fall in WTI prices from $106.55/bbl to $104.7/bbl, triggered by the announcement of renewed
talksbetweenIranandWesternpowersoverIransnuclearprogramme.Overthesameperiod,money
managers also increased their bets on rising Brent prices by 51.7%, from 84 417 to 128 094 futures
contracts,thehighestlevelsinceICEFuturesEuropestartedpublishinginformationontradingofBrent
futureslastJuly.
'000
Contracts
$/bbl
1,600
120
1,500
100
1,400
'000
Contracts
300
$/bbl
110
105
100
100
80
1,300
60
1,200
40
1,100
1,000
20
Jan 09Jul 09 Jan 10Jul 10 Jan 11Jul 11 Jan 12
Open Interest
95
-100
90
-300
85
10 Jan
24 Jan
Producers
Money Managers
Non-Reportables
07 Feb
21 Feb
06 Mar
Swap Dealers
Other Reportables
NYMEX WTI
Producers reduced their net futures short positions from 85660 to 74848 contracts from
31January2012to6March2012;theyheld20.88%oftheshortand16.16%ofthelongcontractsinCME
WTIfuturesonlycontracts.Swapdealers,whoaccountedfor22.69%and35.23%oftheopenintereston
thelongsideandshortside,respectively,increasedtheirnetshortpositionby71.7%tohold198772net
shortinFebruary.ProducerstradingactivityintheLondonWTIcontractsfollowedanoppositepattern
toCMEWTIcontracts.ProducersintheLondonICEWTIcontractsreducedtheirnetlongpositionsfrom
20199 to 12459 contracts over the same period. Swap dealers also reduced their net short positions
duringthesameperiodfrom47011to30492contracts.
Meanwhile,NYMEXRBOBfuturesandcombinedopeninterestincreasedbymorethan14.5%overthe
same period. Open interest in NYMEX heating oil futures contracts increased by almost 4.1% to
286118contracts while open interest in natural gas markets increased by 1.1% to reach
1.22millioncontracts.
36
14 M ARCH 2012
P RICES
IndexinvestorslongexposureincommoditiesinJanuary2012increasedby$17.1billion.However,they
cut$6.4billionfromWTILightSweetCrudeOil,bothonandofffuturescontractsinJanuary.Thenumber
oflongfuturesequivalentcontractsdippedto538000,thelowestsinceDecemberof2008,equivalent
to$53.2billioninnotionalvalue.
Producers' Positions
Swap Dealers' Positions
Money Managers' Positions
Others' Positions
Non-Reportable Positions
Open Interest
Source: CFTC
Long
Short
256.0
125.0
255.3
141.5
97.2
330.9
323.8
45.7
114.1
60.5
Net
-74.8
-198.8
209.5
27.4
36.7
1584.8
Long/Short
Short
Short
Long
Long
Long
Net Vs Last
Week
Month
9.9
8.1
-18.9
1.3
-0.3
67.0
10.8
-83.0
36.6
29.6
5.9
185.0
Market Regulation
AsmentionedintheOMRof10February,theEuropeanCouncilandParliamentreachedanagreement
on the final draft of the proposed European Markets Infrastructure Regulation (EMIR), which aims to
increase transparency and reduce risk in the overthecounter derivatives markets and establishes
commonrulesforCentralCounterpartyClearingHouses(CCPs)andtraderepositories(TRs).Theagreed
EMIRcallsforclearingofallOTCderivativesthroughCCPs.Theruleextendsreportingrequirementsnot
onlytoOTC derivatives,butalsotootherderivativescontracts. Theauthoritytoidentify the contracts
subjecttoaclearingobligationisdelegatedtotheEuropeanSecuritiesandMarketsAuthority(ESMA).
Furthermore, the final version gives public authorities the right to authorise CCP. However, in case of
disputesbetweenpublicauthoritiesovertheauthorisationofCCPs,ESMAcanplayabindingnegotiator
roleormaytakeafinaldecisionontheauthorisationofaCCPifaskedbypublicauthorities.Also,CCPs
from third countries will be recognised in the European Union if the domestic legal regime has an
effectiveequivalentsystemfortheauthorisationofCCPs.ThefinaldraftofEMIRisstillpendingapproval
from the European Parliament and Council. It is expected to be approved by the European Parliament
duringits1215Marchsession,andthentheCouncilwillneedtoformallyadopttherules.Onceadopted
bytheCouncil,itwillbepublishedintheOfficialJournalandtheruleswillenterintoforce20daysafter
thepublication.Thenewrulesareexpectedtobeeffectivebytheendof2012.
On 23 February 2012, the US CFTC reproposed its rule for determining the appropriate block size for
differentassetclasses.AsreportedintheJanuaryOMR,theruleonappropriateblocksizewasremoved
fromthefinalruleonrealtimereportingofswaptradesinDecember.Severalmarketparticipantshad
asked the CFTC to reconsider its rule on timing of public dissemination of details of large trades since
theyneedtimetohedgeorlayoffriskincurredwiththeselargetradesbeforetheyarereportedtotrade
repositories. The new rule calls for different block sizes for different asset classes. The Commission
proposed to adopt a twoperiod approach to determine the appropriate block size for different asset
classes.Intheinitialperiod,whichwouldlastforaminimumofoneyear,theappropriatesizeissetby
theCommission.Forexample,forNYMEXWTIandICEBrentoilswaps,theinitialappropriateminimum
blocksizeissetat100000barrels.Inthepostinitialperiod,theCommission,basedondatacollectedby
traderepositories,willestablishtheappropriateminimumblocksizeusinga75percentnotionalamount
calculationtoestablishandupdatethesesizesinnolessthanoneyear.
On27February2012,afederalcourtdeclinedISDAandSIFAMsrequestagainsttheimplementationof
the CFTCs position limit rule. However, the court expressed concern that the Commission might have
overreached itsmandate bypreemptivelysettingapositionlimitoncommodityderivativescontracts,
14 M ARCH 2012
37
P RICES
without sufficient costbenefit analysis. The court also declared its intention to rule whether to halt
temporarilytheimplementationofthepositionlimitrule.Thecourt,however,mightnotneedtoruleon
thepositionlimituntilJune,sincetheregulators(CFTCandSEC)failedtoreachanagreementonthefinal
rule, which defines what a swap is. The position limit rule will be effective sixty days after the term
swapisdefinedbytheCommission.Theearliestestimateforthefinalruleonthedefinitionofswap
isforearlyApril,whichimpliesthatthepositionlimitwillnotbeeffectiveuntilJune,evenifthefederal
courtdidnotprovideatemporaryinjunctiontostopimplementation.
TheUSCFTCdelayeditsvoteonthefinalruledefiningswapdealerandmajorswapparticipants,which
will eventually determine which entities face mandatory capital and margin requirements as well as
positionlimits.ThevotehadbeendelayedtwicebytheCommissionon23Februaryand9Marchbutthe
CFTCmaybringthefinalruleforvotinginits20Marchmeeting.SomereportssuggestthattheCFTCmay
increase the threshold that determines which market participants are deemed swap dealers from the
originallyproposedlevelof$100millionin2010to$3billion,basedonthenotionalvalueofacompanys
annualswapstrade.Theprospectiveincreaseinthresholdwillcertainlyexemptsomeenergycompanies,
whichhavelongclaimedthattheiruseofswapsistoreduceriskstiedtooilandnaturalgasassets,from
beingclassifiedasswapdealers.
The International Organisation of Securities and Commissions (IOSCO) issued a consultation paper on
functioningandoversightofoilpricereportingagencies(PRAs).ThisfollowsthemandatefromtheG20
Cannes Summit Declaration in November 2011 for IOSCO, in collaboration with the IEF, the IEA and
OPEC,topreparerecommendationstoimprovetheirfunctioningandoversighttoourFinanceMinisters
bymid2012.The consultationpaper askedstakeholdersviewsontherole andoperationofoilprice
reporting agencies, including the impact of PRAs on physical and paper oil markets, the effects of
differentmethodologiesusedbydifferentPRAsonmarketprices,theimpactofcurrentfunctionsofthe
PRAs on price transparency in the physical and paper oil markets, the current governance of PRAs
without any independent third party oversight, and the need for public oversight of PRAs. IOSCO has
requestedresponsesby30March2012.Basedonstakeholderresponses,IOSCOwillthenproposeaset
ofrecommendations,incollaborationwiththeIEA,IEFandOPEC,tobesubmittedto theG20Finance
MinistersmeetinginJune2012inMexico.
38
14 M ARCH 2012
P RICES
14 M ARCH 2012
39
P RICES
SpotcrudeoilpricesmatchedtheupwardmovesinfuturesmarketsinFebruaryandearlyMarch.With
existing supply disruptions having the biggest impact on European and Asian markets, prices for Brent
andDubaicrudespostedthelargestincreasesoverthepastsixweeks.SpotpricesforDatedBrentwere
up in February by just under $9/bbl, to an average $119.50/bbl, while Dubai rose about $6.35/bbl to
$116.15/bbllastmonth.Bycontrast,USWTIrosebyasmaller$2/bbltoaround$102.30/bblonaverage
inFebruary,withhigherstocklevelsatCushing,Oklahomatemperingpricegains.
$/bbl
130
$/bbl
120
-5
110
-10
100
-15
90
-20
-25
80
Data source: Platts analysis
70
Feb 11
-30
Data source: Platts analysis
May 11
WTI Cushing
Aug 11
Nov 11
-35
Feb 11
Feb 12
Dated Brent
Dubai
May 11
Aug 11
Nov 11
Feb 12
The price disconnect between the US benchmark crude and global markets saw the price spread
between the two benchmark crudes widen to the steepest levels in six months. The spot WTIDated
Brent differential was averaging around $19.35/bbl in the first decade of March, compared with an
average $17.20/bbl in February and $10.10/bbl in January. The steeper WTI/Brent differential follows
thesurgeincrudeoilinventoriesattheCushing,Oklahomastoragedepot.Cushingstocksjumpedtothe
highestlevel sincelastJune,followingapurgeoftheSeawaypipelineaheadofitsplannedreversalas
wellasreducedrefineryrunsintheregion.
$/bbl
$/bbl
1
Urals
Differentials (NWE / Med) vs Brent
5
4
0
-1
-2
-3
-4
-5
-6
Feb 11
Nigeria
Differentials to Dated Brent
May 11 Aug 11
Urals (NWE)
Nov 11 Feb 12
Urals (Med)
-1
Feb 11 May 11
Aug 11
Brass River-DB
Forcados-DB
Nov 11
Feb 12
Bonny Light-DB
AlthoughEuropeanrefinerscontinuetosearchforreplacementgradesforheavierIranianbarrels,spot
crude markets are currently fairly wellsupplied, especially with lighter crudes. However, Brent prices
have remained relatively strong given increased demand from Asia, while demand for Urals and light
crudesfromNigeriaeasedonamplesuppliesandweakrefinerdemand.TheBrentpricedifferentialto
distillaterich Nigeria crudes tumbled, with the BrentBonny spread falling to just $0.20/bbl in early
Marchcomparedwith$1.10/bblonaverageinFebruaryandarobust$2.75/bblinJanuary.
40
14 M ARCH 2012
P RICES
TheBrentUralspremiumalsocollapsedinFebruary,inpartduetoweakerfueloilcrackspreads.Urals
wasalsosupportedearlyintheNewYearbyhigherrefinerinterestinthegradesinceitisconsidereda
suitablereplacementforIraniancrudeinEurope.AfterpostinganunusualpremiumtoBrentforseveral
daysattheendofJanuary,UralsintheMediterraneanwastradingata$1.10/bbldiscounttoBrenton
averageinFebruaryandasharp$3.30/bbldiscountbyearlyMarch.
Brentcrude'spremiumtoDubaiwidenedinFebruaryon $/bbl
Brent vs. Dubai
reduced demand for the latter as the northern 14
Data source: Platts analysis
hemispherewinterdrewtoacloseandonamplesupplies 12
of sour grades. The BrentDubai differential widened to 10
around $3.40/bbl in February compared to around 8
6
$0.80/bbl in January. Relatively strong Asian demand, 4
however, is keeping a floor under Middle East crude 2
prices,especiallygiventhelossofheaviercrudesupplies 0
-2
fromSyria,SouthSudan,SudanandYemen.
-4
Feb 11
May 11
Aug 11
Nov 11
Feb 12
ChinahasreportedlyincreasedpurchasesofSaudigrades
Dated Brent - Dubai Mth1
and Russian ESPO crude in recent weeks although there
aresignsthatatleastonelengthypricingdisputethathadseenChinesetermpurchasesofIraniancrude
runningathalf2011s550kb/dhasbeenresolved.NewcontractsrunfromApril,althoughitisthought
likelythatChineserefinerswillcontinuetoseekalternativeMiddleEastsuppliesinanefforttobeseen
to be reducing Iranian offtake in 2012. However, unlike European refiners directly affected by the oil
embargoonIran,includingacutoffininsurancecoveragefortankerliftings,Chinesecompaniesareable
tousethedomesticfleet,whichislessreliantonEuropeaninsurance.
Gasoline crack spreads rose monthonmonth in all regions. In the US Gulf, gasoline crack spreads
increasedby$1.52/bblversusMars,andinNewYorkHarbourby$6.66/bbltoWTI.Therefineryclosures
both in Europe and the Caribbean supported markets at the beginning of the month. However, crack
spreads narrowed throughout February as low demand readings again came into focus, and with
increasingstocksasbothUSrefineryrunswerehighandthearbitragefromEuropewasopen.
Gasoline
Cracks to Benchmark Crudes
$/bbl
$/bbl
4
60
50
40
0
-4
30
20
10
0
-10
Feb 11
Naphtha
Cracks to Benchmark Crudes
-8
-12
-16
May 11 Aug 11
NWE Unl 10ppm
Med Unl 10ppm
14 M ARCH 2012
Nov 11
Feb 12
NYH Unl 93
SP Prem Unl
-20
Feb 11
Feb 12
41
P RICES
In Europe, gasoline crack spreads widened by $0.69/bbl versus Brent in Northwest Europe, and by
$1.32/bbltoUralsintheMediterranean.PricesweresupportedbyexportopportunitiestotheUS,Latin
AmericaandtheMiddleEast.Regionalsuppliesweretighteronseasonallylowerregionalrefineryruns,
leading to a large stock draw in independent storage in the ARA region. Meanwhile in Asia, gasoline
crackswerestableoverthemonth,andstrengthenedslightlyby$0.35/bblversusDubai.Robustdemand
continuedtoprovideafloortopricesaswellastheupcomingrefinerymaintenanceseason.
Naphtha prices showed diverging trends in February, with markets weakening in Europe while
strengthening in Asia. Asian crack spreads increased by $3.12/bbl to Dubai monthonmonth, and crack
spreadsmovedintopositiveterritoryatendFebruaryforthefirsttimesinceMay2011.Increaseddemand
fromthepetrochemicalindustryinSouthKoreaandTaiwanhelpedliftcracks,butjustasimportantwere
fearsoftightsuppliesduetorefinerymaintenanceandlowerarbitragevolumesfromEurope.InEurope,
weakdemandandaclosedarbitragetotheEastpressuredcrackspreadslowerinFebruary.
$/bbl
Gasoil/Heating Oil
Cracks to Benchmark Crudes
45
Data source: Platts analysis
40
35
30
25
20
15
10
5
Feb 11
May 11 Aug 11
NWE Gasoil 0.1%
Med Gasoil 0.1%
Nov 11
Feb 12
NYH No. 2
SP Gasoil 0.5%
$/bbl
Diesel Fuel
Cracks to Benchmark Crudes
50
45
Data source: Platts analysis
40
35
30
25
20
15
10
Aug 11
Feb 11
May 11
NWE ULSD 10ppm
Med ULSD 10ppm
Nov 11
Feb 12
NYH No. 2
NYH ULSD
Middle distillate crack spreads trended downwards in February, falling in all regions bar New York
Harbour. In Northwest Europe, diesel to Brent fell by $3.42/bbl monthonmonth, to an average
$14.29/bbl.Demandwasgenerallyweakerasthepeakwinterseasoncametoanendandhighflatprices
also limited buying. More important, however, was the large stock build seen in the ARA region in
February, partly caused by an open arbitrage from the US due to high prices. The cold snap at the
beginningofthemonthhadonlyamarginalimpactonthemarketasicingproblemsontheRhinelimited
distributiontotheinlandmarkets.Also,consumerswerereluctanttoreplenishstocksattheendofthe
winterheatingseasongiventhehighpricelevel.IntheMediterranean,crackswerebettersupportedby
strongdemandfromNorthAfrica,andlessinflowsfromRussiaduetohigh domestic demand,limiting
suppliesavailableforexports.
IntheUS,middledistillatemarketsalsosoftenedinFebruary.Heatingoilcrackspreadsfellby$1.82/bbl
toMarsintheUSGulf,whereasthecrackspreadfirmedby$4.09/bblversusWTIinNewYorkHarbour
due to the relative weakness of WTI. Generally, middle distillate markets were supported by arbitrage
possibilities,bothtoLatinAmericaandEurope.However,marketseasedashigherregionalrefineryruns
ledtostocksbuilding.
In Asia, Singapore gasoil crack spreads narrowed by $1.73/bbl to Dubai monthonmonth. High prices
slowed demand, and limited arbitrage opportunities due to weaker European prices left supplies
stranded in the region. Stocks built considerably in Singapore, and were at monthend above the
fiveyearaverageforthefirsttimesincetheendofOctober.
Fuel oil crack spreads also narrowed in February, with HSFO crack spreads falling in a $3.80$5.79/bbl
rangeinEuropeandAsia,whereasLSFOcrackspreadsfellalesser$1.15$2.62/bbl.InAsia,crackspreads
werepressuredlowerasfueloildemandinChinafellaftertheLunarNewYearandinJapanwiththeend
42
14 M ARCH 2012
P RICES
ofthepeakwinterdemandseason,albeitpowersectordemandremainssupportive.Atthesametime,
fueloilstocksswelledaslargearbitragevolumescontinuedtoarrivefromtheWest.
$/bbl
20
15 Data source: Platts analysis
10
5
0
-5
-10
-15
-20
Feb 11 May 11 Aug 11
NWE LSFO 1%
SP LSWR
$/bbl
5
0
-5
-10
-15
-20
Nov 11
Feb 12
Med LSFO 1%
-25
Feb 11 May 11 Aug 11
NWE HSFO 3.5%
SP HSFO 380 4%
Nov 11
Feb 12
Med HSFO 3.5%
In Europe, fuel oil markets weakened as both demand fell and supplies increased. European utility
demanddeclinedwithwarmerweatherthroughoutFebruary,andinflowsfromtheBlackSeaincreased
inthesecondhalfofthemonthaftericingproblemsreducedexportsfromportsearlierinFebruary.In
addition,alessworkablearbitragetoAsiainthesecondhalfofthemonthkeptvolumesinEuropewith
stocksbuildingasaresult.
Freight
Despite buoyant demand for Middle Eastern crudes in Asia, notably China, vessel oversupply again
weighed heavily, with rates on the benchmark Middle East Gulf Japan route trading flat at close to
$14/mtfrommidFebruaryonwards.Althoughratesremainrelativelyhighcompared tothedire3Q11
performance, surging bunker prices have capped earnings. The West Africa Suezmax market was
relativelyvolatileduringFebruarywithshortperiodsofactivitynotsustainedandampletonnagefurther
limitinggains.Despitethevolatility,byearlyMarchratesstoodatcloseto$17/mt,thesamelevelasa
month earlier. The North Sea Aframax market fared the worst out of the benchmark trades as rates
stayedcloseto$6/mtthroughoutFebruary.Thelowratescombinedwithhighbunkercostsreportedly
pushedearningstotheirlowestlevelinovertwoyears.
US$/m t
28
US$/m t
35
24
30
20
25
16
20
12
15
10
4
0
Jun 10
Dec 10
8 0 k t N S e a - N W E ur
V LC C M E G ulf - J a p
Jun 11
Dec 11
13 0 k t W A f r- US A C
0
Jun 10
Dec 10
3 0 K C a rib - US A C
75K M EG-Jap
Jun 11
Dec 11
2 5 K UKC - US A C
3 0 K S E A s ia - J a p
Diverging trends were reported in product tanker markets, with the Atlantic Basin out performing
voyages serving Asian markets. The transatlantic gasoline trade again took off after a wide arbitrage
openeduptomoveproductfromEuropetotheUSAtlanticcoast,consequentlyaschartersscrambledto
findavailablevesselstheratesurgedtoover$30/mtbylateFebruary.However,asisoftenthecaseon
thisvoyagetheratedroppedbackto$26/mtbyearlyMarchasaraftofnewvesselsenteredthemarket
and combined with slowing demand. In the East, all benchmark voyages have been on a steady
14 M ARCH 2012
43
P RICES
downwardtrendsofarthisyearasamixtureofsluggishdemandandvesseloversupplyhaspressured
rates.The Singapore Japanshorthaulroutelanguishedat closeto$16/mtformuchof Februarybut
some upward momentum was generated in earlyMarch as increased demand tightened tonnage. An
earlyMarch upturn was also evident on the long range Middle East Gulf Japan route as increased
demandwassufficienttosoakupexcesstonnage.
Market intelligence suggests that our previous assessments of Iranian floating storage at over 30 mb
weretoohigh.ItisnowwidelyreportedthatIranianfloatingvolumesrecentlysharplydeclinedto8mb,
storedon4vesselsafterNITCwasrequiredtoemploymoreoftheirtankerstomaintaindeliveriesinthe
absence of western vessels currently prohibited from calling at Iranian ports due to insurance issues
connected to US sanctions. As this situation persists, the potential for a future rise in Iranian floating
storageisstronglydiminished.
44
14 M ARCH 2012
R EFINING
REFINING
Summary
Global refinery crude throughputs have been revised slightly lower for 1Q12, on weakerthan
expected nonOECD readings for a number of countries. A counterseasonal increase in US runs in
February,however,providedpartialoffset.Inall,1Q12globalrunsareestimatedtopostannualgains
of180kb/d,toaverage74.9mb/d,or35kb/dlessthanpreviouslyforecast.
FinaldataforDecemberforanumberofnonOECDcountriesledto4Q11globalrefinerycruderun
estimates being adjusted lower by 300 kb/d, to 74.6 mb/d, or 120 kb/d below yearearlier levels.
Annualgrowthisexpectedtoresumein1Q12and 2Q12,withglobalcrude throughputsforecastto
rise180kb/dand610kb/d,respectively,toaverage74.9mb/dand74.5mb/d.
OECD refinery runs fell seasonally by 220 kb/d in January, to 36.8mb/d on average. The start of
seasonalmaintenanceintheUSandEurope,andtheclosureofcapacityinEuropebroughtrunslower
in these regions, while Pacific runs inched higher on stronger Japanese throughputs. While
preliminarydatashowUSrunsrisingcounterseasonallyinFebruary,afterstrongmarginsinJanuary
andamidrelativelylightturnarounds,throughputsareexpectedtofallseasonallyincomingmonths.
Refinery margins plummeted in February, and reached negative territory for most benchmarks
surveyed, after a temporary respite in January. The reported closure of Atlantic Basin capacity had
raisedmarginsearlierintheyear.Productpricesthenfailedtokeepupwithcrudeoilpriceincreases
through February, and further downward pressure on margins came from news of the return to
operationofcapacity(Petroplus)inEurope.MarginsontheUSWestCoastfaredbetter,afterafire
andshutdownofBPsCherryPointplantinFebruary.
mb/d
77
Global Refining
mb/d
Crude Throughput
Annual growth
3.5
76
2.5
75
1.5
74
0.5
73
-0.5
72
-1.5
71
Jan
-2.5
Mar
May
Range 06-10
2010
2012 est.
Jul
-3.5
Sep
Nov
Jan
Average 06-10
2011 est.
1Q08
1Q09
Crude Runs
1Q10
1Q11
1Q12
While January estimates have also been reduced, based on the weaker December readings and some
additional outage information, runs are expected to return to yearago levels before rebounding from
Marchonwards.GrowthisseencomingfromChina,India,Russia,andmostrecently,theUS.US50crude
intake in February was more than 1 mb/d above yearearlier levels. Improved US Gulf Coast refinery
45
R EFINING
Infact,refinerymarginsplummetedformostbenchmarkssurveyedinFebruary,afteratemporaryrespite
in January. Margins were lifted earlier in the year, by the closure of capacity in the Atlantic Basin and
concernsoverproductsupplies.NewsofthereturntooperationofcapacityinEurope(Petroplus)brought
marginssharplyloweragaininFebruary,andmostbenchmarkswerenegativeinearlyMarch.Marginson
theUSWestCoastfaredbetter,followingafireandshutdownofBPsCherryPointplantinFebruary.
Selected Refining Margins in Major Refining Centres
($ /bbl)
Monthly Average
NW Europe
Jan 12
Feb 12
Brent (Cracking)
Urals (Cracking)
-0.22
0.34
3.01
3.95
1.48
2.20
Brent (Hydroskimming)
-1.93
0.87
-1.39
Urals (Hydroskimming)
-4.51
-0.87
-4.16
-1.23
-1.38
-4.11
-6.70
2.21
2.16
-1.31
-3.43
-6.30
-1.65
-3.70
-2.02
-8.02
Change
Dec 11
Brent (Cracking)
LLS (Cracking)
Mars (Cracking)
Mars (Coking)
Maya (Coking)
17 Feb
24 Feb
02 Mar
09 Mar
-1.53
-1.75
2.06
2.67
0.90
1.72
0.89
1.61
-0.31
1.47
-0.80
2.04
-2.26
-0.34
-2.05
-2.31
-3.60
-4.00
-3.30
-2.96
-4.70
-5.38
-5.69
-5.18
1.41
0.74
-2.77
-6.14
-0.80
-1.42
-1.46
-2.71
1.62
0.84
-2.01
-5.43
1.19
0.42
-3.09
-6.48
1.09
0.29
-3.50
-7.18
0.34
-0.24
-4.11
-7.81
0.58
-0.03
-3.71
-7.73
-1.85
4.75
1.06
2.58
-2.11
-3.96
1.73
-0.25
1.13
1.42
-2.12
-3.02
-1.31
-1.45
3.53
-2.74
4.01
0.98
2.06
2.45
-4.84
-0.27
-1.00
0.10
0.78
-4.70
-0.16
-0.99
0.88
1.56
-6.75
-0.31
-2.44
-0.94
-0.33
-7.17
-0.09
-1.45
0.20
1.22
-1.32
1.00
-5.20
2.22
0.89
8.61
-0.91
7.25
2.65
8.02
2.37
10.18
1.76
-0.59
3.28
2.93
0.72
9.40
0.66
10.68
1.93
8.19
2.07
9.13
4.59
8.30
5.20
12.03
3.37
3.84
2.28
9.24
3.06
6.46
1.60
11.76
Feb 12-Jan 12
Singapore
Dubai (Hydroskimming)
Tapis (Hydroskimming)
Dubai (Hydrocracking)
Tapis (Hydrocracking)
-2.08
-7.97
-0.66
-8.54
0.83
-4.29
2.08
-5.05
-1.17
-5.85
0.98
-6.34
-2.00
-1.56
-1.10
-1.29
0.48
-4.08
2.15
-5.05
-1.32
-6.02
0.79
-6.64
-2.76
-7.94
-0.25
-8.07
-3.87
-8.91
-1.05
-8.83
-4.60
-9.91
-2.04
-10.26
China
Cabinda (Hydroskimming)
Daqing (Hydroskimming)
Dubai (Hydroskimming)
Daqing (Hydrocracking)
Dubai (Hydrocracking)
-0.07
-0.48
-2.37
-0.61
-0.82
2.68
0.93
0.45
1.12
1.82
0.54
0.93
-1.52
1.82
0.79
-2.15
-0.01
-1.97
0.71
-1.04
2.32
2.22
0.18
2.18
1.99
0.60
1.28
-1.71
1.98
0.55
-2.02
-0.65
-3.14
0.92
-0.46
-1.99
-1.60
-4.30
0.44
-1.32
-2.40
-2.04
-5.00
-0.67
-2.28
Fo r the purpo ses o f this repo rt, refining margins are calculated fo r vario us co mplexity co nfiguratio ns, each o ptimised fo r pro cessing the specific crude in a specific refining centre
o n a 'full-co st' basis. Co nsequently, repo rted margins sho uld be taken as an indicatio n, o r pro xy, o f changes in pro fitability fo r a given refining centre. No attempt is made to mo del
o r o therwise co mment upo n the relative eco no mics o f specific refineries running individual crude slates and pro ducing custo m pro duct sales, no r are these calculatio ns intended
to infer the marginal values o f crudes fo r pricing purpo ses.
*The China refinery margin calculatio n represents a mo del based o n spo t pro duct impo rt/expo rt parity, and do es no t reflect internal pricing regulatio ns.
So urces: IEA , P urvin & Gertz Inc.
Inall,4Q11globalthroughputsarenowassessedat74.6mb/d,120kb/dbelowyearearlierlevels,but
areseenrisingto74.9mb/din1Q12.RecentmonthsChineseandRussiandatapointtohealthyrefinery
activityinthosecountries,asdodataforBrazil,SouthKoreaandtheUS.Ontheotherhand,European
runs remain depressed, a phenomenon which may persist in months to come if individual refiners
struggletoreplaceIranianbarrels.
2Q12throughputsareestimatedtofallseasonallyto74.5mb/d,nonethelessreturningtoannualgrowth
of around 0.6 mb/d. Strength comes from China, the US, and Other Asia, all of which see the
46
R EFINING
commissioning of new capacity. The startup of Motivas expanded Port Arthur plant on the US Gulf
Coastaddsanadditional325kb/dtoUSdistillationcapacity.Chinacommissionednewcapacityduring
December and January, which will ramp up over coming months. Despite some delays, new Indian
capacity is expected to gradually rampup from March onwards, including MRPLs Mangalore refinery,
theBathindagrassrootsproject,Nagarjuna,aswellasEssarsexpandedVadinarplant.
Feb 12
Mar 12
Apr 12
1Q2012
May 12
Jun 12
2Q2012
North America
18.0
18.0
17.9
17.7
17.8
17.4
17.6
17.8
18.1
18.3
18.1
Europe
12.1
12.3
12.1
12.1
11.9
11.7
11.9
11.6
11.8
12.1
11.9
Pacific
Total OECD
6.6
6.8
6.5
7.0
6.9
6.5
6.8
6.4
6.1
5.9
6.1
36.7
37.0
36.5
36.8
36.6
35.6
36.3
35.8
36.0
36.3
36.0
FSU
6.6
6.6
6.6
6.7
6.8
6.5
6.7
6.4
6.7
6.8
6.6
Non-OECD Europe
0.6
0.6
0.5
0.6
0.5
0.5
0.5
0.5
0.6
0.6
0.6
China
9.2
9.2
9.1
9.3
9.3
9.2
9.3
9.4
9.1
9.2
9.2
Other Asia
9.1
9.1
8.9
9.2
9.2
9.0
9.2
9.0
9.1
9.2
9.1
Latin America
5.1
4.8
5.0
5.0
5.1
4.9
5.0
5.0
4.9
4.9
4.9
Middle East
6.1
5.9
6.0
5.8
5.9
5.5
5.7
5.6
5.9
5.9
5.8
Africa
2.2
2.0
2.1
2.2
2.2
2.2
2.2
2.2
2.1
2.1
2.2
Total Non-OECD
38.7
38.3
38.1
38.9
38.9
37.9
38.6
38.2
38.4
38.7
38.5
Total
75.5
75.3
74.6
75.7
75.5
73.4
74.9
74.0
74.4
75.1
74.5
1 Preliminary and estimated runs based on capacity, know n outages, economic run cuts and global demand forecast
Note: US Virgin Islands included in North America and not Latin America as previously
mb/d
41
40
39
38
37
36
35
34
Jan
OECD Total
mb/d
Crude Throughput
2.0
1.0
0.0
-1.0
-2.0
Mar
May
Range 06-10
2010
2012 est.
Jul
Sep
Nov
Jan
-3.0
1Q09 3Q09 1Q10 3Q10 1Q11 3Q11 1Q12
Average 06-10
2011
Crude Runs
Preliminary data for February show total OECD runs slightly lower than January, at 36.6 mb/d, but
350kb/dhigherthanpreviouslyexpected.AcounterseasonalincreaseinUScrudeintakeoffsetlower
runsinthePacific.NorthAmericancruderunsindeedposteda0.9mb/dannualincreaseinFebruary,on
47
R EFINING
a light seasonal maintenance schedule and relatively healthy refining margins in January, while both
EuropeanandPacificthroughputsremainedatthebottomoftheirhistoricalrange.
Utilisation rate1
Aug 11
Sep 11
Oct 11
Nov 11
Dec 11
Jan 12
Dec 11
Jan 11
15.59
15.27
14.54
14.96
14.84
14.59
-0.25
0.14
84.8%
82.5%
0.30
0.30
0.27
0.27
0.27
0.30
0.03
0.04
86.3%
75.1%
Canada
1.68
1.74
1.62
1.63
1.68
1.62
-0.06
-0.17
88.4%
97.9%
Mexico
1.24
1.10
1.15
1.18
1.16
1.21
0.06
0.09
73.6%
72.7%
18.81
18.41
17.59
18.04
17.95
17.73
-0.23
0.11
85.7%
84.4%
France
1.37
1.33
1.32
1.38
1.41
1.17
-0.23
-0.25
75.0%
81.3%
Germany
2.02
1.91
2.03
1.96
1.95
1.95
0.00
-0.03
91.4%
82.9%
Italy
1.66
1.57
1.55
1.52
1.55
1.57
0.03
-0.20
72.0%
77.9%
Netherlands
1.04
1.04
0.97
0.97
1.03
1.08
0.06
0.06
84.1%
79.1%
Spain
1.07
1.09
1.00
1.10
1.09
1.09
0.00
0.01
71.7%
76.3%
United Kingdom
1.51
1.47
1.39
1.45
1.46
1.48
0.02
0.00
81.7%
81.6%
3.94
3.76
3.64
3.75
3.83
3.77
-0.07
-0.04
76.4%
77.4%
12.61
12.18
11.90
12.13
12.30
12.11
-0.19
-0.45
78.5%
79.3%
Japan
3.37
3.14
2.98
3.20
3.37
3.57
0.20
-0.16
77.7%
79.1%
South Korea
2.43
2.50
2.63
2.64
2.62
2.65
0.03
0.11
96.8%
93.0%
0.74
0.73
0.63
0.72
0.77
0.74
-0.03
0.02
78.9%
76.3%
6.54
6.37
6.24
6.56
6.76
6.96
0.20
-0.03
84.1%
83.3%
37.96
36.95
35.73
36.73
37.01
36.79
-0.22
-0.38
82.2%
81.7%
US2
US Virgin Islands
OECD Europe
OECD Pacific
OECD Total
Jan 12
Jan 11
1 Expressed as a percentage, based o n crude thro ughput and current o perable refining capacity
2 US50
North American crude runs fell by 225 kb/d in January, as seasonal maintenance got underway.
Scheduled turnarounds were lighter than normal in the US, leaving regional runs 105 kb/d above
yearearlierlevels.US50runs,whichareestimatedtohaveoutperformedyearearlierlevelsby140kb/d
basedonpreliminarydata,postedgainsontheWestCoastandintheMidwest,whileGulfandEastCoast
operationswereloweryearonyear.
Note:fromthismonthsreportwehaveincludedtheUSVirginIslandsintheNorthAmericanregional
breakdown,ratherthaninLatinAmerica.Hovensashutits350kb/dCaribbeanrefineryinmidFebruary
after accumulating losses of $1.3 billion in past three years. The plant supplied the US East Coast in
particular,butrecentlyalsoexpandedsalestoothermarkets.
mb/d
mb/d
Crude Throughput
19.5
3.0
19.0
2.5
18.5
2.0
18.0
1.0
17.0
0.5
Mar
May
Range 06-10
2010
2011
48
Refinery Shutdowns
1.5
17.5
16.5
Jan
Jul
Sep
Nov
Jan
Average 06-10
2011 est.
2012 est.
0.0
Jan
Mar
May
Jul
Range 07-11
2011 reported
Sep Nov
Jan
2010
2012 Forecast
R EFINING
USGulfCoastmarginsimprovedsharplyoverJanuary,onhighergasolinecracksfollowingthenewsof
reducedcapacityontheEastCoastandintheUSVirginIslands.HovensaannouncedinearlyJanuaryit
wouldhaltoperationsatitsCaribbeanplantbymidFebruary,furthertighteningAtlanticBasinproduct
markets.OntheEastCoast,Sunocoidledits178kb/dMarcusHookrefineryinDecember2011following
theshutdownofConocoPhillips185kb/dTrainerrefineryinSeptember2011.Withhighthroughputsin
February, however, margins plummeted on the Gulf Coast again and reached negative territory for all
benchmarkssurveyedinearlyMarch,exceptforMayacoking.WestCoastmarginsweresupportedbya
17FebruaryfireatBPs220kb/dCherryPointrefinery,whichdamagedtheplantsonlycrudeunitand
forced the refinerys shutdown. While the duration of the outage is still not clear, some sources
estimateditcouldbeseveralmonthsbeforefulloperationsarerestored.
m b/d
16.5
$/bbl
16
USGC Margins
12
16.0
15.5
15.0
14.5
-4
-8
14.0
Source: EIA
13.5
Jan
Apr
Jul
Range 2007-2011
2011
Oct
-12
Jan 11
Apr 11
Jul 11
Maya Coking
Mars Coking
Brent Cracking
5-yr Average
2012
Oct 11
Jan 12
LLS Cracking
Mars Cracking
US50 crude runs rose counterseasonally in February, to an estimated 14.8 mb/d based on adjusted
weekly data from the EIA. Higher margins in January and a lighterthannormal maintenance schedule
underpinned higher February throughputs. As a result, it is estimated that North American refiners
processed almost 0.9mb/d more crude than a year earlier. Yearonyear gains were mostly accounted
forbyGulfCoastrefinerswhoadded685kb/d.MidwestandWestCoastrefinerswerealsopostinggains,
of 160kb/d and 75 kb/d, respectively, with only the East Coast contracting annually due to the
shutdownsmentionedabove.
Monthonmonth, US Gulf Coast throughputs rose 235 kb/d in February, to 7.4 mb/d on average. The
startupofMotivasexpandedPortArthurrefineryincomingmonthscouldfurtherliftruns.TheMotiva
PortArthurrefinery,whichisa5050jointventurebetweenSaudiAramcoandShell,isnearcompletion
ofa$7billionexpansion thatwillmaketheplantthelargestrefineryinthe US.Operablecapacitywill
increasefrom285kb/dcurrentlyto600kb/d,andcokingcapacitywillnearlydoubleto95kb/dallowing
theplanttoprocessheaviercrudes.Anewhydrocrackerwillfurtherincreasetheplantsdistillateyields
while increased reforming capacity will boost highoctane gasoline component output. We expect the
planttocomeonstreamin2Q12,buttheexacttimingoframpuphasstillnotbeenannounced.
m b/d
8.5
m b/d
3.7
8.0
3.5
7.5
3.3
7.0
3.1
6.5
2.9
Source: EIA
6.0
Jan
Source: EIA
Apr
Jul
Oct
Range 2007-2011
5-yr Average
2011
2012
2.7
Jan
Apr
Range 2007-2011
2011
Jul
Oct
5-yr Average
2012
49
R EFINING
OECDEuropeanrunsfellbyalmost200kb/dinJanuaryto12.1mb/d,closeto0.5mb/dlessthanayear
earlier. Declines were steepest in France, were LyondellBasell halted operations at its 105 kb/d Berre
refineryatthebeginningoftheyearandinsolventPetroplusshutthePetitCouronnerefinerymidmonth
whencrudesuppliesranout.MaintenanceworkatTotalsLaMedeplantandIneosneighbouringLavera
refinery cut rates further. French throughputs were 230 kb/d lower monthonmonth, and 250kb/d
belowayearearlier.RunswerealsolaggingyearearlierlevelsinItaly,theseaveraging200kb/dlessin
January, at 1.57 mb/d. Enis 80 kb/d Porto Marghera refinery remains shut due to poor margins and
several other refiners have also had to reduce runs due to weak economics. Italian refiners were
particularlyhardhitbythelossofLibyansuppliesandmorerecentlytheIranianembargo.Italianrefiners
sourced23%oftheircrudefromLibyain2010and13%fromIran.
OECD Europe
mb/d
14.4
OECD Europe
mb/d
Crude Throughput
Firm Shutdowns
2.0
13.9
1.5
13.4
12.9
1.0
12.4
0.5
11.9
11.4
Jan
Mar
May
Jul
Sep
Range 06-10
2010
2011
Nov
Jan
0.0
Jan
Average 06-10
2012 est.
Mar
May
Jul
Range 07-11
Sep
Nov
Jan
2011
2012 Forecast
2012 Reported
EuropeancruderunsareexpectedtofallfurtherthroughApril,asregionalmaintenanceintensifies.The
spring turnaround schedule is nevertheless expected to be lighter than last year, even including the
temporaryshutdownsofPetroplusrefineriesandtheeconomicruncutsatRepsolsBilbaorefineryand
EnisPortoMarghera.
EuropeanrefiningmarginsdeterioratedsharplyinFebruaryandearlyMarch,oneverrisingcrudeprices
andonthenewsthatsomePetroplusplantswouldresumeoperation.Marginshadearlierbeengivena
lift in January on news of the refinery closures in the Atlantic basin. NWE cracking margins fell by
$1.53/bbland$1.75/bblforBrentandUrals,respectively,inFebruary,withBrentmarginsdippinginto
negativeterritoryinearlyMarch.CrackingmarginsintheMedfellbysimilaramountsandalsoposted
lossesinearlyMarch.Simple(hydroskimming)marginsfurtherdeterioratedinboththenorthandsouth,
reachinglossesofupto$8/bblforrefinersprocessingUralsintheMed.
$/bbl
6
$/bbl
5
Mediterranean Margins
4
2
0
-2
-5
-4
-6
-8
Jan 11
Apr 11
Jul 11
Brent Cracking
Urals Cracking
50
Oct 11
-10
Jan 11
Jan 12
Brent H'skimming
Urals H'skimming
Apr 11
Jul 11
Urals Cracking
Es Sider Cracking
Oct 11
Jan 12
Urals H'skimming
Es Sider H'skimming
R EFINING
OECD Pacific crude runs were mostly in line with expectations for January, at 6.96 mb/d, up 200 kb/d
monthonmonth and unchanged from a year earlier, as higher South Korean runs offset weaker
Japanesethroughputs.PreliminarydatafromPAJ,however,pointtostillweakerJapanesecrudeintake
inFebruary,leadingtoadownwardrevisionof180kb/dfortheregion.Pacificrunsaresettofallsharply
overcomingmonths,toalowpointof5.9mb/dinJuneasregionalmaintenanceintensifies.JXNippon
announcedon9Marchithadresumedfulloperationsatits145kb/dSendairefinery,oneyearafterit
wasdamagedintheearthquakeandtsunami.The11March2011earthquakeatsunamishutterednearly
1.4 mb/d of crude distillation capacity, or 31% of Japans total. Of this 800 kb/d was restored within
10days.Now,onlyCosmos220kb/dChibarefineryremainsofflinefollowingthedisaster.Thelatteris
still awaiting permission from local government to resume operations at the first of its two crude
distillationunits.
OECD Pacific
mb/d
South Korea
mb/d
Crude Throughput
7.5
2.8
7.0
2.6
6.5
2.4
6.0
Crude Throughput
2.2
5.5
Jan
Mar
May
Range 06-10
2010
2012 est.
Jul
Sep
Nov
2.0
Jan
Jan
Average 06-10
2011
Mar
2008
2011
May
Jul
Sep
2009
2012 est.
Nov
Jan
2010
51
R EFINING
Non-OECD Total
mb/d
40
39
38
37
36
35
34
33
Jan
mb/d
10.0
9.5
9.0
8.5
8.0
7.5
7.0
6.5
6.0
5.5
Jan
Crude Throughput
Mar
May
Jul
Sep
Range 06-10
2010
2012 est.
Nov
Jan
Crude Throughput
Mar
Average 06-10
2011 est.
May
Jul
Sep
2008
2010
2012 est.
Nov
Jan
2009
2011
2012
Chinese refinery runs reached another record high in January as refiners ramped up runs to secure
adequate product supplies ahead of the Chinese New Year holiday. Throughputs averaged 9.34 mb/d,
almost 0.6mb/d higher than a year earlier, but 50 kb/d less than our previous forecast. As expected,
refinerstrimmedrunsslightlyinFebruary,to9.26mb/d,withtheonsetofseasonalmaintenanceandas
increasingcrudeoilpricescutintooperatingmargins.
CNPC shut a 160 kb/d crude unit at its Zhenhai refinery from midFebruary for 50 days, WEPEC were
planning slightly lower runs due to maintenance at some secondary units, and Anqing Petrochemical
shut a 110 kb/d unit for 45 days from 10 February. Runs have also likely fallen further in March as
SinopecsMaomingrefineryalsoshuta50kb/dcrudeunitandDalianisplanningtoshutonecrudeunit
fromlateMarch.Chineserefineriesarestillloosingmoneyduetogovernmentpricecontrolsonrefined
productsales.
Other Asian refinery throughputs were largely in line with expectations for December, averaging
9.1mb/d.Januaryruns,however,were85kb/dlowerthanforecastonweakerthanexpectedactivityin
India.Indiancruderunsfellby0.6%monthlyand4.6%annually,to4.2mb/d,duetoloweryearonyear
runs at Reliances 660kb/d Jamnagar refinery. The plants runs nevertheless stood at 709 kb/d,
compared to690kb/din December. Relianceshut a290kb/dcrudeunitat the580kb/dexportplant
frommidFebruaryforthreeweeksofmaintenance.Thisisthefirstscheduledturnaroundattheplant
sinceitwascommissionedin2008.
Crude Throughput
4.4
4.2
4.0
3.8
3.6
3.4
3.2
3.0
Jan
9.0
8.5
8.0
7.5
Jan
Mar
May
Range 06-10
2010
2012 est.
52
Jul
India
mb/d
Other Asia
mb/d
9.5
Sep
Nov
Jan
Average 06-10
2011 est.
Crude Throughput
Mar
2008
2011
May
Jul
Sep
2009
2012 est.
Nov
Jan
2010
R EFINING
The startup of the new Nagarjuna refinery, which was to be commissioned on 1 March, has been
delayedbymostlikelythreemonthsduetodamagecausedbyJanuaryscycloneThane.Newcapacityis
still expected to be brought on line in March by MRPL, which is adding a 60 kb/d crude unit to its
Mangalorerefinery.Thecompanyisalsoaddinga60kb/dvacuumdistillationunit,adieselhydrotreater,
followedbyothersecondaryunits,includinganFCC,laterintheyear.
BothIndianandChinesecrudeoilimportsreachedalltimehighsinJanuary.Chinaimported5.53mb/d
of crude in January, up 7.4% yearonyear, while India imported 4 mb/d, an 18.7% annual increase
accordingtoofficialdata.
Taiwans crude intake fell to only 706 kb/d in December, the lowest since April 2011, but in line with
forecast.RefineryproductionatFormosas540kb/dMailiaorefineryhasyettorecoverfromaseriesof
fires and outages that hit the plant in 2010/2011. The company is undertaking major safety checks,
reducingoutputtodifferingdegreesuntilatleastMay.
Russianrefinerycrudeintakerose145kb/dinJanuaryto5.31mb/donaverage,correspondingto4.4%
annual growth. The monthly increase stemmed mostly from the return to service of TNKBPs Saratov
refinery, which halted operations due to maintenance in December. Preliminary data show Russian
refinery runs rose further in February, to 5.37 mb/d, up 5.3% annually, and some 140 kb/d above
expectations.FromMarchonwards,Russianthroughputsareexpectedtofallsharplyasrefineriescarry
outseasonalmaintenance.FrompracticallynoworkinJanuaryandFebruary,offlinecapacityinMarchis
estimated at 335 kb/d, rising to almost 500 kb/d in April. Lukoils Nizhny Novogrod, TNKBPs Ryazan,
AlliancesKhaborovsk,SlavneftsYaroslavandRosneftsSyrzanandNovokyibyshevplants,areamongthe
refineriesexpectedtoreducerunsovertheMarchAprilperiodduetomaintenancework.
Russia
mb/d
mb/d
7.0
6.8
6.6
6.4
6.2
6.0
5.8
5.6
5.4
Jan
Crude Throughput
5.6
5.4
5.2
5.0
4.8
4.6
4.4
4.2
Jan
Mar
2008
2011
May
Jul
Sep
2009
2012 est.
Nov
Jan
2010
FSU
Crude Throughput
Mar
May
Range 06-10
2010
2012 est.
Jul
Sep
Nov
Jan
Average 06-10
2011 est.
53
R EFINING
$/bbl
30
80
25
60
20
40
15
20
10
0
30
50
70
90
110 130 150
Average Urals Price $/bbl
Crude Oil
Refining Tax Incentive*
0
30
Oil Products
50
70
90
110
130
150
Average Urals Price $/bbl
*Oil products export duty and refining tax incentive calculated based on current refining configuration (20% naphtha/gasoline yield,
80% other products). Of course, refineries will higher or lower complexity, will pay different product duties and enjoy varying tax
incentives.Also,companieswithhigherfueloilyield,incurlowermarginsthanbeforetheintroductionof6066,thoughagainoffsetby
higherflatprices.
ElsewhereintheFSU,TNKBPannounceditwouldsuspendsuppliesofcrudetothe320kb/dLysychansk
refineryinUkrainefromMarch,becauseofcontinuousoperatinglosses.Thedurationoftheshutdownis
not known, but we assume it will be shut for at least a month. Despite nameplate capacity of some
800kb/d,annualdatashowUkrainesrefinerieswererunningatverylowutilisationratesofaround25%
in2009(latestavailabledata).Kazakhstanicruderunsfellby27kb/dinJanuary,to295kb/d,down8.5%
fromthepreviousmonthbut5.8%higherthanJanuary2011.InLithuania,PKNOrlensMazeikiuNafta
refinerywillshutinMarchformaintenance.
MiddleEasterncruderunshavebeenrevisedlowerfor4Q11followingararerevisiontoSaudiArabias
JODIdata.Octobercruderunswere175kb/dlowerthanfirstpublished,at1.8mb/d.Iraqicruderunsare
54
R EFINING
assessedat592kb/dinJanuary,downfrom600kb/dinDecember.InYemen,theAdenrefineryremains
shut,morethantwomonthsafterapipelineexplosionhaltedcrudedeliveriestotheplant.Thecountry
isseekingdieselimportstomeetdomesticdemand.Omanisexpectedtoundertakemaintenancelasting
45 days at its 85 kb/d Mina al Hahal refinery starting March. While no data is available for Syrias
downstreamoperations,weassumeHomsrefineryisrunningatreducedratesduetopipelinesabotage
andreduceddomesticproduction.CurrentSyrianoilproductionisestimatedat190kb/din1Q12,allof
whichisassumedtofeedthecountrystwodomesticrefinerieswithacombinedcapacityof240kb/d.
Africa
Middle East
mb/d
2.6
2.5
2.4
2.3
2.2
2.1
2.0
1.9
Jan
Crude Throughput
mb/d
6.5
6.3
6.1
5.9
5.7
5.5
Jan
Mar
May
Range 06-10
2010
2012 est.
Jul
Sep
Nov
Jan
Average 06-10
2011 est.
Crude Throughput
Mar
May
Jul
Sep
Range 06-10
2010
2012 est.
Nov
Jan
Average 06-10
2011 est.
InAfrica,therestartofLibyasRasLanufplanthasagainbeendelayed,duetoproblemsrestoringSarir
andMeslaproduction.WenowonlyexpecttheplanttoresumeoperationsbylateApril.Chadsrefinery
outputresumedinFebruary,afterthegovernmentanditsChinesepartner,CNPC,reachedanagreement
overfuelpricing.WhilethereisnomonthlydatatrackingSudanesecruderuns,weassumethatrunsat
the100kb/dKhartoumrefineryhavebeenreducedduetotheshuttinginofoilproduction.
Latin America
mb/d
5.8
mb/d
5.4
Crude Throughput
5.6
5.2
5.4
5.0
5.2
4.8
5.0
4.6
4.8
4.4
4.6
Jan
Mar
May
Range 06-10
2010
2012 est.
Jul
Sep
Nov
4.2
Jan
Jan
Average 06-10
2011 est.
Crude Throughput
Mar
May
Range 06-10
2010
2012 est.
Jul
Sep
Nov
Jan
Average 06-10
2011 est.
55
T ABLES
Table 1
WORLD OIL SUPPLY AND DEMAND
TABLES
OECD DEMAND
North America
Europe
Pacific
24.2 23.3
15.4 14.7
8.1
7.7
Total OECD
47.6 45.6
4.2
4.2
0.8
0.7
7.7
8.1
9.7 10.1
6.0
6.0
7.3
7.5
3.3
3.3
4.4
4.3 4.6
4.6
4.5
0.7
0.7 0.7
0.7
0.7
8.6
9.1 8.9
9.7
9.1
10.4 10.6 10.2 10.6 10.4
6.0
6.3 6.5
6.4
6.3
7.4
7.8 8.3
7.7
7.8
3.3
3.4 3.4
3.4
3.4
4.6 4.7
4.9 4.9
4.8
0.7 0.7
0.7 0.7
0.7
9.8 9.9
9.7 10.1
9.9
10.9 11.0 10.7 11.2 10.9
6.4 6.6
6.8 6.7
6.7
7.7 8.2
8.6 8.1
8.2
3.5 3.5
3.5 3.5
3.5
Total Non-OECD
38.9 39.9
86.6 85.6
Europe
Pacific
13.3 13.6
4.8
4.5
0.6
0.7
Total OECD
18.8 18.8
12.8 13.3
0.1
0.1
3.8
3.9
3.7
3.6
3.7
3.9
1.7
1.7
2.6
2.6
28.4 29.1
NON-OECD DEMAND
FSU
Europe
China
Other Asia
Latin America
Middle East
Africa
Total Demand
OECD SUPPLY
North America4
NON-OECD SUPPLY
FSU
Europe
China
Other Asia2
Latin America2,4
Middle East
Africa2
Total Non-OECD
Processing Gains3
2.0
2.0
2.0
2.1
2.1
2.1
2.1
2.2
2.1
2.1
2.2
2.2
2.3
2.2
2.2
2.3
2.3
Global Biofuels4
1.4
1.6
1.4
2.0
2.1
1.8
1.8
1.5
1.9
2.2
1.8
1.8
1.6
1.9
2.2
2.0
1.9
Total Non-OPEC2
50.6 51.5
49.6 51.5
Total OPEC2
31.6 29.1
4.5
4.9
36.1 34.1
37.1 34.1
Total Supply6
86.7 85.6
0.4
0.0
0.9
-0.1
-0.1
-0.1
0.1
0.0
-0.4
0.0
OPEC
Crude5
NGLs
-0.8
0.1
0.5
0.0
-0.1
-0.4
-0.7
0.1
6.1
6.2
6.5
6.5
6.3
-0.2
-0.1
0.3
0.0
0.4
0.9
-0.2
-0.7
0.1
-0.5
0.5
-0.5
-0.6
-0.3
0.0
-0.2
0.3
-0.3
-0.2
-0.4
0.1
-1.4
-0.2
-1.1
-0.3
-0.6
-0.2
-0.9
0.2
-0.3
-0.2
-0.7
-0.2
-0.4
-0.1
0.3
-0.1
-0.3
0.2
0.0
-0.2
-0.5
-1.5
-1.7
-1.0
-0.6
-0.4
-1.1
-0.4
-0.6
Memo items:
Call on OPEC crude + Stock ch.8
Adjusted Call on OPEC + Stock ch.9
31.5 29.2
31.3 28.8
1 Measured as deliveries from refineries and primary stocks, comprises inland deliveries, international marine bunkers, refinery fuel, crude for direct burning,
oil from non-conventional sources and other sources of supply.
2 Other Asia includes Indonesia throughout. Latin America excludes Ecuador throughout. Africa excludes Angola throughout.
Total Non-OPEC excludes all countries that were members of OPEC at 1 January 2009. Non-OPEC Historical Composition excludes countries that were OPEC members at that point in time.
Total OPEC comprises all countries which were OPEC members at 1 January 2009. OPEC Historical Composition comprises countries which were OPEC members at that point in time.
3 Net volumetric gains and losses in the refining process and marine transportation losses.
4 As of the July 2010 OMR, Global Biofuels comprise all world biofuel production including fuel ethanol from the US and Brazil.
5 As of the March 2006 OMR, Venezuelan Orinoco heavy crude production is included within Venezuelan crude estimates. Orimulsion fuel remains within the OPEC NGL and
non-conventional category, but Orimulsion production reportedly ceased from January 2007.
6 Comprises crude oil, condensates, NGLs, oil from non-conventional sources and other sources of supply.
7 Includes changes in non-reported stocks in OECD and non-OECD areas.
8 Equals the arithmetic difference between total demand minus total non-OPEC supply minus OPEC NGLs.
9 Equals the "Call on OPEC + Stock Ch." with "Miscellaneous to balance" added for historical periods and with an average of "Miscellaneous to balance" for the most recent 8 quarters added for forecast periods.
56
14 M ARCH 2012
T ABLES
Table 1A
Table 1a - WORLD
World Oil
ChangesFROM
fromLAST
LastMONTH'S
MonthsTABLE
Table11
OILSupply
SUPPLYand
AND Demand:
DEMAND: CHANGES
(million barrels per day)
2008 2009
OECD DEMAND
North America
Europe
Pacific
-0.1
-
-0.1
-
0.1
-0.1
Total OECD
-0.1
FSU
Europe
China
Other Asia
Latin America
Middle East
Africa
0.2
-
-0.1
-
-0.1
-
Total Non-OECD
0.2
-0.1
Total Demand
0.2
-0.1
North America
Europe
Pacific
0.1
-
-0.1
-
-0.1
-
0.1
-0.1
-
0.2
-0.1
-
0.1
-0.1
-
Total OECD
0.1
-0.1
-0.1
Total Non-OECD
-0.1
-0.1
0.1
-0.2
0.1
-0.1
-0.1
-0.1
-0.1
-0.1
-0.1
-0.2
-0.1
-0.2
-0.2
-0.1
-0.1
-0.2
-0.1
-0.1
-0.2
Processing Gains
Global Biofuels
Total Non-OPEC
-0.1
0.1
-0.1
-0.2
-0.3
-0.2
-0.2
-0.2
-0.1
0.1
-0.1
-0.2
-0.3
-0.2
-0.2
-0.2
Crude
NGLs
-0.1
-
-0.1
-
-0.1
-
-0.1
-
-0.2
-
Total OPEC
-0.1
-0.1
-0.1
-0.1
-0.2
-0.1
-0.1
-0.1
-0.1
-0.2
Total Supply
-0.1
-0.2
-0.1
-0.1
0.1
-0.2
-0.1
-
Total
-0.1
-0.1
-0.2
-0.1
-0.1
0.1
-0.1
-0.1
-0.2
-0.1
-0.1
0.1
-0.2
-0.1
0.1
-0.1
-0.1
-0.1
-0.1
-
0.1
-0.1
0.4
0.3
0.2
0.2
0.2
0.1
0.1
-
0.2
0.1
NON-OECD DEMAND
OECD SUPPLY
NON-OECD SUPPLY
FSU
Europe
China
Other Asia
Latin America
Middle East
Africa
OPEC
Memo items:
Call on OPEC crude + Stock ch.
Adjusted Call on OPEC + Stock ch.
When submitting their monthly oil statistics, OECD Member countries periodically update data for prior periods. Similar updates to non-OECD data can occur.
14 M ARCH 2012
57
T ABLES
Table 2
2009
1Q10
2Q10
3Q10
4Q10
2010
1Q11
2Q11
3Q11
4Q11
2011
1Q12
2Q12
3Q12
4Q12
2012
Demand (mb/d)
North America
Europe
Pacific
Total OECD
Asia
Middle East
Latin America
FSU
Africa
Europe
Total Non-OECD
World
23.29
14.66
7.69
45.64
18.19
7.53
5.99
4.18
3.33
0.71
39.93
85.57
23.41
14.32
8.23
45.95
18.98
7.42
6.05
4.38
3.33
0.67
40.84
86.79
23.69
14.26
7.35
45.29
19.65
7.83
6.29
4.33
3.43
0.68
42.21
87.50
24.10
14.93
7.62
46.65
19.12
8.29
6.46
4.55
3.38
0.68
42.48
89.13
23.85
14.83
8.07
46.75
20.26
7.72
6.39
4.57
3.43
0.70
43.08
89.83
23.77
14.58
7.82
46.17
19.50
7.82
6.30
4.46
3.39
0.68
42.16
88.32
23.78
14.20
8.35
46.33
20.27
7.62
6.29
4.46
3.41
0.67
42.72
89.05
23.31
14.12
7.11
44.55
20.23
8.01
6.48
4.61
3.34
0.69
43.35
87.90
23.56
14.69
7.68
45.93
19.70
8.46
6.67
4.82
3.27
0.72
43.63
89.56
23.35
14.06
8.28
45.70
20.62
7.96
6.57
4.84
3.37
0.72
44.09
89.79
23.50
14.27
7.86
45.63
20.20
8.02
6.50
4.69
3.34
0.70
43.45
89.08
23.27
13.73
8.62
45.63
20.72
7.75
6.45
4.60
3.48
0.68
43.68
89.31
23.08
13.62
7.38
44.08
20.83
8.19
6.64
4.71
3.53
0.70
44.61
88.69
23.60
14.33
7.62
45.54
20.38
8.62
6.81
4.93
3.49
0.71
44.95
90.49
23.55
14.08
8.06
45.68
21.35
8.11
6.73
4.95
3.54
0.72
45.41
91.09
23.38
13.94
7.92
45.24
20.82
8.17
6.66
4.80
3.51
0.70
44.66
89.90
of which: US50
Europe 5*
China
Japan
India
Russia
Brazil
Saudi Arabia
Canada
Korea
Mexico
Iran
Total
18.77
8.98
8.06
4.39
3.26
3.03
2.54
2.47
2.16
2.19
2.07
2.11
60.03
18.87
8.87
8.63
4.82
3.38
3.17
2.60
2.33
2.15
2.31
2.07
2.10
61.31
19.15
8.75
9.06
4.07
3.45
3.17
2.71
2.73
2.17
2.18
2.10
2.08
61.61
19.47
9.15
8.92
4.36
3.13
3.40
2.82
3.02
2.29
2.16
2.05
2.08
62.86
19.23
9.01
9.66
4.57
3.38
3.36
2.80
2.54
2.25
2.35
2.07
2.09
63.31
19.18
8.95
9.07
4.45
3.34
3.28
2.73
2.66
2.22
2.25
2.07
2.09
62.28
19.17
8.71
9.54
4.86
3.50
3.21
2.69
2.49
2.25
2.36
2.05
2.09
62.91
18.82
8.57
9.52
3.92
3.57
3.43
2.77
2.89
2.15
2.04
2.06
2.05
61.80
18.89
8.89
9.30
4.32
3.26
3.64
2.88
3.15
2.29
2.21
2.09
2.03
62.95
18.71
8.54
9.69
4.82
3.57
3.63
2.86
2.74
2.22
2.30
2.11
2.04
63.22
18.90
8.68
9.51
4.48
3.47
3.48
2.80
2.82
2.23
2.23
2.08
2.05
62.72
18.66
8.49
9.82
5.13
3.59
3.33
2.73
2.60
2.21
2.33
2.08
2.07
63.05
18.62
8.26
9.86
4.16
3.67
3.51
2.80
2.99
2.13
2.07
2.06
2.06
62.18
18.96
8.63
9.72
4.25
3.37
3.73
2.91
3.23
2.26
2.22
2.08
2.05
63.43
18.91
8.47
10.13
4.55
3.71
3.71
2.90
2.83
2.22
2.33
2.11
2.06
63.92
18.79
8.46
9.88
4.52
3.59
3.57
2.84
2.91
2.21
2.24
2.08
2.06
63.15
% of World
70.2%
70.6%
70.4%
70.5%
70.5%
70.5%
70.7%
70.3%
70.3%
70.4%
70.4%
70.6%
70.1%
70.1%
70.2%
70.2%
1.6
-0.9
1.5
0.8
6.8
2.7
3.9
1.8
2.2
-0.2
4.6
2.6
-1.6
-1.0
-3.2
-1.7
2.9
2.3
2.9
6.6
-2.9
1.8
2.7
0.5
-2.2
-1.6
0.8
-1.5
3.0
2.0
3.2
5.9
-3.3
5.2
2.7
0.5
-2.1
-5.1
2.6
-2.2
1.8
3.2
2.8
5.8
-1.8
2.6
2.3
0.0
-1.1
-2.2
0.5
-1.2
3.6
2.6
3.2
5.0
-1.5
2.4
3.1
0.9
-2.1
-3.3
3.3
-1.5
2.2
1.6
2.6
3.1
2.1
1.5
2.2
0.3
-1.0
-3.5
3.7
-1.0
3.0
2.3
2.6
2.2
5.8
0.8
2.9
0.9
0.1
-2.5
-0.8
-0.9
3.5
2.0
2.2
2.3
6.9
-0.3
3.0
1.0
0.8
0.1
-2.7
0.0
3.5
1.9
2.5
2.2
5.1
-0.2
3.0
1.4
-0.5
-2.3
0.8
-0.9
3.1
1.9
2.4
2.4
5.0
0.4
2.8
0.9
0.37
-0.12
0.12
0.37
1.29
0.20
0.24
0.08
0.07
0.00
1.88
2.25
-0.38
-0.14
-0.23
-0.75
0.58
0.18
0.18
0.29
-0.10
0.01
1.14
0.40
-0.54
-0.24
0.06
-0.72
0.58
0.17
0.21
0.27
-0.11
0.04
1.15
0.43
-0.50
-0.76
0.21
-1.05
0.36
0.25
0.18
0.27
-0.06
0.02
1.01
-0.04
-0.26
-0.32
0.04
-0.54
0.70
0.20
0.20
0.23
-0.05
0.02
1.29
0.75
-0.51
-0.46
0.27
-0.70
0.45
0.12
0.16
0.14
0.07
0.01
0.96
0.26
-0.23
-0.50
0.26
-0.46
0.60
0.18
0.17
0.10
0.19
0.01
1.25
0.79
0.03
-0.36
-0.06
-0.39
0.68
0.17
0.15
0.11
0.22
0.00
1.32
0.93
0.20
0.01
-0.23
-0.02
0.73
0.15
0.16
0.11
0.17
0.00
1.32
1.30
-0.12
-0.33
0.06
-0.39
0.62
0.16
0.16
0.11
0.17
0.00
1.21
0.82
0.00
0.02
0.00
0.02
0.00
0.00
0.01
0.01
0.00
0.00
0.02
0.04
0.00
0.01
0.00
0.01
0.00
0.00
0.01
0.00
0.00
0.00
0.01
0.02
0.00
0.00
0.00
0.00
0.00
0.00
0.01
-0.01
0.00
0.00
0.01
0.01
0.03
-0.07
-0.03
-0.07
0.02
0.00
0.05
-0.02
-0.01
0.00
0.04
-0.03
0.01
-0.01
-0.01
-0.01
0.00
0.00
0.02
0.00
0.00
0.00
0.02
0.01
-0.07
0.04
0.04
0.00
0.15
-0.01
0.03
0.02
0.00
0.00
0.19
0.19
-0.04
-0.01
0.00
-0.04
-0.04
-0.01
0.01
0.04
0.00
0.00
0.00
-0.04
-0.01
0.00
0.01
0.00
-0.07
-0.01
0.01
0.04
0.00
0.00
-0.03
-0.03
0.09
-0.02
-0.08
-0.01
-0.07
0.00
0.02
-0.02
-0.01
0.00
-0.08
-0.09
-0.01
0.00
-0.01
-0.01
-0.01
-0.01
0.02
0.02
0.00
0.00
0.02
0.01
0.03
0.02
0.02
-0.03
0.01
0.15
-0.06
-0.04
-0.06
0.00
58
14 M ARCH 2012
T ABLES
Table 2a
Table 2a - OECD Regional Oil Demand
OECD REGIONAL OIL DEMAND1
2011
1Q11
2Q11
3Q11
4Q11
LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products
2.95
0.37
10.57
1.65
4.82
0.93
2.46
2.97
0.35
10.33
1.65
4.92
0.85
2.43
3.31
0.37
10.14
1.60
5.04
0.97
2.35
2.71
0.36
10.45
1.68
4.77
0.87
2.47
2.76
0.34
10.49
1.71
4.86
0.76
2.64
3.10
0.34
10.22
1.59
5.03
0.82
2.26
2.92
0.36
10.21
1.56
5.05
0.77
2.34
3.05
0.34
10.14
1.65
5.16
0.74
2.31
Total
23.77
23.50
23.78
23.31
23.56
23.35
23.21
0.96
1.26
2.21
1.27
6.13
1.27
1.47
0.98
1.16
2.12
1.25
6.03
1.24
1.49
1.04
1.27
2.02
1.20
6.04
1.29
1.33
0.96
1.18
2.18
1.27
5.73
1.22
1.57
0.94
1.13
2.20
1.35
6.17
1.25
1.63
0.96
1.06
2.06
1.19
6.18
1.20
1.42
14.58
14.27
14.20
14.12
14.69
LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products
0.84
1.68
1.57
0.87
1.62
0.74
0.49
0.83
1.69
1.54
0.85
1.63
0.76
0.55
0.88
1.78
1.51
1.18
1.67
0.80
0.54
0.81
1.55
1.47
0.64
1.53
0.65
0.47
Total
7.82
7.86
8.35
LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products
4.76
3.31
14.36
3.80
12.58
2.94
4.42
4.78
3.21
13.99
3.75
12.58
2.85
4.48
Total
46.17
45.63
Nov 11
Dec 10
3.32
0.33
10.30
1.57
4.87
0.94
2.13
0.27
-0.01
0.16
-0.07
-0.29
0.21
-0.18
-0.19
0.02
-0.25
-0.06
-0.37
0.06
-0.11
23.38
23.47
0.08
-0.90
0.91
1.03
2.09
1.28
6.31
1.23
1.47
0.98
1.08
2.08
1.15
6.22
1.14
1.50
1.00
1.06
2.00
1.14
6.00
1.23
1.29
0.02
-0.02
-0.08
-0.01
-0.22
0.08
-0.21
-0.05
-0.20
-0.07
-0.07
-0.41
-0.09
0.01
14.06
14.32
14.16
13.72
-0.44
-0.89
0.79
1.73
1.61
0.63
1.59
0.76
0.56
0.86
1.71
1.57
0.96
1.71
0.82
0.65
0.78
1.62
1.50
0.79
1.64
0.75
0.64
0.83
1.74
1.56
0.88
1.72
0.81
0.57
0.97
1.77
1.66
1.20
1.77
0.90
0.74
0.14
0.03
0.11
0.33
0.06
0.09
0.17
0.03
-0.01
0.02
-0.01
0.02
0.11
0.22
7.11
7.68
8.28
7.73
8.09
9.02
0.92
0.38
5.23
3.43
13.67
3.98
12.75
3.06
4.22
4.48
3.09
14.11
3.58
12.04
2.74
4.51
4.49
3.20
14.31
3.70
12.62
2.77
4.83
4.92
3.11
13.85
3.74
12.91
2.84
4.33
4.62
3.01
13.80
3.63
13.00
2.75
4.46
4.86
3.16
13.78
3.68
13.10
2.69
4.37
5.29
3.16
13.96
3.92
12.64
3.07
4.16
0.43
0.00
0.18
0.24
-0.46
0.38
-0.22
-0.21
-0.19
-0.29
-0.14
-0.76
0.07
0.12
46.33
44.55
45.93
45.70
45.26
45.64
46.20
0.56
-1.40
North America
Europe
LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products
Total
Pacific
OECD
1 Demand, measured as deliveries from refineries and primary stocks, comprises inland deliveries, international bunkers and refinery fuel. It includes crude for direct burning, oil from
non-conventional sources and other sources of supply. Jet/kerosene comprises jet kerosene and non-aviation kerosene. Gasoil comprises diesel, light heating oil and other gasoils.
North America comprises US 50 states, US territories, Mexico and Canada.
2 Latest official OECD submissions (MOS).
14 M ARCH 2012
59
T ABLES
Table 2b
United States
2011
1Q11
2Q11
3Q11
4Q11
Nov 11
Dec 10
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil
Residual Fuel Oil
Other Products
Total
2.17
2.18
0.26
0.26
8.99
8.74
1.45
1.44
3.80
3.85
0.54
0.48
1.97
1.93
19.18 18.90
2.47
0.27
8.61
1.40
3.95
0.61
1.86
19.17
1.96
0.27
8.87
1.49
3.75
0.51
1.97
18.82
1.99
0.25
8.89
1.50
3.78
0.36
2.12
18.89
2.31
0.26
8.61
1.39
3.92
0.43
1.77
18.71
2.16
0.28
8.63
1.37
3.95
0.40
1.84
18.62
2.24
0.26
8.54
1.44
4.06
0.39
1.83
18.76
2.54
0.25
8.66
1.37
3.77
0.51
1.66
18.75
0.29
-0.01
0.13
-0.07
-0.29
0.12
-0.17
-0.01
-0.14
0.02
-0.25
-0.06
-0.41
-0.02
-0.12
-0.97
Japan
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total
0.48
0.77
1.00
0.55
0.41
0.43
0.40
0.41
4.45
0.50
0.72
0.98
0.53
0.41
0.41
0.45
0.49
4.48
0.54
0.79
0.95
0.80
0.41
0.48
0.42
0.47
4.86
0.50
0.65
0.92
0.36
0.39
0.36
0.36
0.38
3.92
0.45
0.74
1.04
0.34
0.41
0.36
0.48
0.51
4.32
0.52
0.70
1.00
0.62
0.43
0.43
0.53
0.60
4.82
0.46
0.66
0.95
0.47
0.42
0.38
0.48
0.57
4.41
0.50
0.72
0.97
0.54
0.43
0.41
0.51
0.54
4.62
0.61
0.73
1.07
0.83
0.45
0.48
0.59
0.68
5.43
0.10
0.00
0.10
0.30
0.02
0.06
0.08
0.15
0.81
0.06
-0.08
0.01
0.02
0.00
-0.02
0.17
0.25
0.40
0.10
0.41
0.46
0.18
0.67
0.43
0.15
0.09
2.49
0.10
0.39
0.46
0.18
0.68
0.36
0.15
0.11
2.41
0.10
0.44
0.43
0.17
0.63
0.37
0.16
0.05
2.35
0.10
0.40
0.47
0.19
0.67
0.23
0.14
0.12
2.34
0.11
0.39
0.47
0.19
0.71
0.42
0.15
0.12
2.55
0.09
0.33
0.46
0.17
0.68
0.41
0.15
0.13
2.42
0.08
0.33
0.48
0.18
0.68
0.47
0.14
0.14
2.50
0.09
0.34
0.48
0.17
0.73
0.38
0.14
0.15
2.47
0.09
0.33
0.43
0.16
0.64
0.39
0.16
0.10
2.28
0.00
-0.01
-0.05
-0.01
-0.09
0.01
0.02
-0.06
-0.19
-0.01
-0.08
0.02
0.01
0.04
-0.08
-0.01
0.05
-0.07
0.11
0.12
0.24
0.10
0.49
0.12
0.13
0.23
1.53
0.10
0.09
0.23
0.10
0.49
0.11
0.11
0.23
1.46
0.12
0.11
0.22
0.09
0.47
0.11
0.10
0.23
1.45
0.08
0.10
0.24
0.10
0.51
0.09
0.11
0.24
1.47
0.08
0.08
0.24
0.12
0.50
0.10
0.13
0.22
1.47
0.11
0.08
0.22
0.09
0.49
0.13
0.10
0.21
1.43
0.09
0.08
0.23
0.11
0.50
0.13
0.12
0.21
1.47
0.10
0.08
0.22
0.08
0.49
0.13
0.09
0.22
1.41
0.13
0.08
0.22
0.09
0.48
0.13
0.10
0.20
1.42
0.03
-0.01
0.01
0.01
-0.01
0.00
0.01
-0.03
0.02
-0.01
-0.03
-0.03
0.00
-0.01
-0.02
-0.04
-0.04
-0.19
0.15
0.13
0.19
0.15
0.69
0.30
0.09
0.17
1.86
0.14
0.13
0.18
0.15
0.70
0.27
0.08
0.17
1.82
0.17
0.13
0.17
0.14
0.69
0.35
0.08
0.13
1.86
0.12
0.14
0.20
0.15
0.71
0.19
0.08
0.19
1.79
0.12
0.13
0.19
0.16
0.71
0.28
0.08
0.20
1.87
0.14
0.12
0.17
0.15
0.69
0.27
0.09
0.16
1.78
0.13
0.10
0.17
0.15
0.70
0.31
0.09
0.16
1.81
0.14
0.12
0.16
0.14
0.69
0.24
0.10
0.17
1.76
0.16
0.14
0.16
0.14
0.69
0.26
0.08
0.15
1.77
0.01
0.02
0.00
0.00
0.00
0.02
-0.02
-0.02
0.01
-0.04
0.03
-0.01
0.00
0.00
-0.16
-0.04
0.02
-0.20
0.14
0.03
0.35
0.33
0.45
0.12
0.06
0.14
1.62
0.14
0.03
0.33
0.33
0.45
0.12
0.06
0.15
1.60
0.14
0.03
0.34
0.34
0.45
0.11
0.07
0.15
1.62
0.15
0.03
0.34
0.32
0.45
0.11
0.06
0.16
1.61
0.13
0.02
0.33
0.33
0.45
0.13
0.06
0.15
1.61
0.12
0.02
0.33
0.32
0.47
0.11
0.06
0.13
1.56
0.12
0.02
0.33
0.33
0.46
0.11
0.06
0.14
1.57
0.12
0.03
0.34
0.33
0.48
0.12
0.06
0.13
1.59
0.12
0.02
0.32
0.32
0.46
0.10
0.07
0.13
1.53
0.00
0.00
-0.02
-0.01
-0.02
-0.02
0.01
0.00
-0.06
-0.01
0.00
-0.01
-0.02
0.05
-0.02
0.01
0.00
0.01
0.35
0.08
0.74
0.11
0.23
0.31
0.10
0.30
2.22
0.36
0.08
0.74
0.11
0.23
0.32
0.10
0.29
2.23
0.39
0.09
0.69
0.11
0.22
0.36
0.11
0.28
2.25
0.35
0.08
0.74
0.10
0.22
0.28
0.09
0.29
2.15
0.36
0.08
0.78
0.12
0.23
0.32
0.08
0.32
2.29
0.35
0.07
0.75
0.11
0.24
0.32
0.11
0.28
2.22
0.35
0.06
0.74
0.10
0.26
0.30
0.09
0.30
2.21
0.37
0.07
0.75
0.11
0.25
0.31
0.11
0.26
2.23
0.32
0.07
0.75
0.11
0.22
0.36
0.13
0.26
2.23
-0.05
0.00
0.01
0.00
-0.03
0.05
0.01
0.00
0.00
-0.04
-0.01
0.01
0.00
0.00
0.00
0.01
-0.02
-0.04
Germany
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total
Italy
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total
France
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total
United Kingdom
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total
Canada
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total
1 Demand, measured as deliveries from refineries and primary stocks, comprises inland deliveries, international bunkers and refinery fuel. It includes crude for direct burning, oil from
non-conventional sources and other sources of supply. Jet/kerosene comprises jet kerosene and non-aviation kerosene. Gasoil comprises diesel, light heating oil and other gasoils.
2 Latest official OECD submissions (MOS).
3 US figures exclude US territories.
60
14 M ARCH 2012
T ABLES
Table 3
2011
8.05
3.70
2.36
2.31
2.03
0.53
0.80
1.73
2.08
1.55
1.25
0.47
2.53
9.04
3.58
2.67
2.50
2.21
0.59
0.82
1.64
2.18
0.46
1.28
0.50
2.50
29.41
5.34
29.96
5.78
Total OPEC
34.75
34.75
OECD
North America
United States5
Mexico
Canada
Europe
UK
Norway
Others
Pacific
Australia
Others
14.10
7.77
2.96
3.37
4.14
1.36
2.14
0.65
0.61
0.51
0.10
14.56
8.11
2.94
3.50
3.83
1.11
2.04
0.67
0.52
0.43
0.09
Total OECD
18.86
2012
3Q11
4Q11
1Q12
2Q12
9.34
3.53
2.67
2.53
2.26
0.60
0.82
1.69
2.26
0.04
1.28
0.49
2.46
9.37
3.51
2.68
2.54
2.33
0.60
0.82
1.72
2.06
0.55
1.29
0.49
2.40
29.97
5.79
30.35
5.91
35.74
35.76
35.74
35.76
15.07
8.49
2.86
3.72
3.68
1.07
1.96
0.65
0.64
0.56
0.08
14.55
8.11
2.92
3.53
3.62
0.94
1.99
0.69
0.51
0.43
0.09
15.04
8.43
2.92
3.69
3.82
1.11
2.05
0.67
0.55
0.47
0.09
15.05
8.43
2.90
3.72
3.75
1.10
2.00
0.66
0.60
0.51
0.09
14.84
8.48
2.89
3.47
3.63
1.08
1.89
0.66
0.64
0.56
0.08
18.91
19.39
18.68
19.42
19.40
13.55
10.45
3.10
13.58
10.58
3.00
13.78
10.71
3.07
13.54
10.58
2.96
13.57
10.67
2.90
Asia
China
Malaysia
India
Indonesia
Others
7.80
4.10
0.72
0.86
0.97
1.14
7.68
4.12
0.66
0.89
0.93
1.08
7.71
4.17
0.67
0.90
0.87
1.10
7.60
4.06
0.65
0.89
0.94
1.06
Europe
0.14
0.14
0.14
Latin America
Brazil5
Argentina
Colombia
Others
4.07
2.14
0.69
0.79
0.45
4.22
2.19
0.67
0.92
0.44
4.43
2.33
0.67
1.00
0.43
1.74
0.87
0.39
0.30
0.19
1.65
0.89
0.33
0.23
0.20
2.50
0.70
0.25
1.56
Total Non-OECD
Processing Gains4
Global Biofuels5
3Q12
Dec 11
Jan 12
Feb 12
9.50
3.45
2.69
2.58
2.26
0.60
0.82
1.75
2.06
0.75
1.29
0.48
2.38
9.55
3.43
2.65
2.58
2.35
0.60
0.82
1.70
2.04
1.15
1.29
0.48
2.47
9.70
3.38
2.61
2.59
2.30
0.60
0.81
1.76
2.14
1.30
1.27
0.48
2.48
30.61
5.91
31.11
6.14
31.42
6.14
36.26
36.52
37.25
37.56
36.26
36.52
37.25
37.56
15.05
8.45
2.84
3.76
3.54
0.97
1.92
0.64
0.66
0.58
0.08
15.24
8.53
2.93
3.78
3.80
1.11
2.05
0.64
0.59
0.50
0.09
15.08
8.42
2.90
3.77
3.77
1.09
2.04
0.65
0.55
0.46
0.09
15.05
8.42
2.90
3.73
3.73
1.09
1.97
0.67
0.63
0.55
0.09
19.10
19.26
19.63
19.41
19.42
13.72
10.64
3.08
13.84
10.71
3.13
13.66
10.74
2.91
13.44
10.62
2.83
13.73
10.64
3.08
13.68
10.63
3.05
7.58
4.02
0.67
0.87
0.92
1.09
7.75
4.14
0.69
0.90
0.90
1.12
7.70
4.15
0.67
0.90
0.88
1.09
7.67
4.15
0.67
0.91
0.86
1.09
7.63
4.05
0.70
0.87
0.91
1.10
7.77
4.15
0.69
0.89
0.92
1.12
7.74
4.14
0.68
0.90
0.89
1.13
0.14
0.14
0.14
0.14
0.14
0.14
0.14
0.14
4.20
2.16
0.67
0.93
0.44
4.32
2.25
0.69
0.95
0.43
4.33
2.30
0.66
0.94
0.44
4.42
2.32
0.67
1.00
0.43
4.48
2.35
0.67
1.03
0.43
4.36
2.30
0.68
0.93
0.44
4.37
2.32
0.67
0.94
0.44
4.27
2.29
0.64
0.90
0.44
1.45
0.90
0.18
0.18
0.19
1.69
0.90
0.35
0.24
0.20
1.49
0.89
0.21
0.18
0.20
1.44
0.89
0.19
0.16
0.20
1.44
0.89
0.18
0.17
0.20
1.46
0.91
0.17
0.18
0.19
1.49
0.90
0.21
0.18
0.20
1.46
0.88
0.19
0.18
0.20
1.42
0.89
0.19
0.14
0.20
2.54
0.69
0.24
1.61
2.35
0.68
0.25
1.42
2.54
0.69
0.24
1.61
2.56
0.68
0.25
1.63
2.37
0.68
0.24
1.45
2.29
0.68
0.24
1.37
2.33
0.67
0.25
1.40
2.56
0.68
0.25
1.63
2.57
0.69
0.25
1.63
2.29
0.68
0.24
1.36
29.80
29.80
29.86
29.71
29.66
29.76
29.84
29.73
29.61
30.02
29.54
2.10
2.17
2.26
2.14
2.23
2.28
2.23
2.24
2.23
2.28
2.28
1.83
1.83
1.94
2.15
1.80
1.60
1.94
2.24
1.63
1.62
1.59
TOTAL NON-OPEC6
52.58
52.71
53.45
52.68
53.11
53.04
53.11
53.47
53.10
53.32
52.83
52.58
52.71
53.45
52.68
53.11
53.04
53.11
53.47
53.10
53.32
52.83
TOTAL SUPPLY
87.33
88.45
88.44
89.37
89.62
90.57
90.39
OPEC
Crude Oil
Saudi Arabia
Iran
Iraq
UAE
Kuwait
Neutral Zone
Qatar
Angola
Nigeria
Libya
Algeria
Ecuador
Venezuela
Total Crude Oil6
Total NGLs1,6
6
6.34
6.14
6.19
6.49
NON-OPEC
NON-OECD
Former USSR
Russia
Others
Middle East
Oman
Syria
Yemen
Others
Africa
Egypt
Gabon
Others
1 Includes condensates reported by OPEC countries, oil from non-conventional sources, e.g. Venezuelan Orimulsion (but not Orinoco extra-heavy oil),
and non-oil inputs to Saudi Arabian MTBE. Orimulsion production reportedly ceased from January 2007.
2 Comprises crude oil, condensates, NGLs and oil from non-conventional sources
3 Includes small amounts of production from Israel, Jordan and Bahrain.
4 Net volumetric gains and losses in refining and marine transportation losses.
5 As of the July 2010 OMR, Global Biofuels comprise all world biofuel production including fuel ethanol from the US and Brazil.
6 Total OPEC comprises all countries which were OPEC members at 1 January 2009. OPEC Historical Composition comprises countries which were OPEC members at that point in time.
Total Non-OPEC excludes all countries that were OPEC members at 1 January 2009. Non-OPEC Historical Composition excludes countries that were OPEC members at that point in time.
14 M ARCH 2012
61
T ABLES
Table 4
Table 4 - OECD Industry Stocks and
Quarterly Stock Changes/OECD Government1
OECD
AND QUARTERLY STOCK CHANGES
Controlled Stocks
andINDUSTRY
QuarterlySTOCKS
Stock Changes
Table 4a - Industry Stocks on Land in2 Selected Countries
2
North America
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total
Europe
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total
Pacific
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total
Total OECD
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total
in Million Barrels
in Million Barrels
STOCK CHANGES
in mb/d
Sep2011
Oct2011
Nov2011
Dec2011
Jan2012*
Jan2009
Jan2010
Jan2011
1Q2011
2Q2011
3Q2011
4Q2011
466.7
250.6
227.8
42.4
707.3
475.6
243.1
218.1
44.4
689.4
475.6
254.5
216.7
47.2
697.9
463.0
259.0
225.1
40.8
697.2
473.3
270.2
227.1
39.8
696.9
476.7
249.9
217.7
40.8
681.7
462.4
266.1
237.6
48.1
699.0
478.7
269.6
234.4
47.5
703.2
0.25
-0.03
-0.24
-0.05
-0.58
0.02
-0.01
-0.04
-0.01
0.29
-0.36
0.02
0.16
-0.02
0.30
-0.04
0.09
-0.03
-0.02
-0.11
1341.8
1333.9
1334.3
1309.8
1325.3
1308.5
1302.1
1328.4
-0.39
0.49
0.03
-0.35
308.3
89.0
265.4
64.1
538.6
299.6
90.9
260.0
63.1
535.1
303.0
94.3
264.4
63.1
539.8
286.7
94.3
274.4
60.3
547.0
295.2
95.3
267.9
60.5
541.1
343.4
105.9
276.4
79.8
572.7
339.1
111.4
305.5
72.0
600.9
334.2
104.4
299.9
68.6
587.9
0.01
0.04
0.09
-0.01
0.11
-0.05
-0.09
-0.13
-0.03
-0.22
-0.11
-0.03
-0.09
0.00
-0.08
-0.24
0.06
0.10
-0.04
0.09
911.3
900.6
912.1
900.7
903.8
992.9
1012.0
992.7
0.06
-0.24
-0.23
-0.12
157.0
24.4
67.8
20.2
181.0
155.1
24.0
66.6
19.9
180.6
155.8
23.3
68.3
19.7
178.0
155.7
22.1
61.1
19.1
164.5
148.1
24.9
62.6
19.8
164.5
171.6
22.4
64.5
20.7
168.6
163.5
27.1
65.3
18.9
169.6
158.5
25.1
60.1
18.6
168.4
0.00
0.01
-0.06
0.02
-0.09
0.01
0.01
0.14
0.01
0.18
-0.03
-0.01
0.01
-0.01
0.10
-0.01
-0.02
-0.07
-0.01
-0.18
411.5
407.2
407.5
390.1
385.1
408.7
397.0
400.8
-0.10
0.26
0.07
-0.23
932.1
363.9
561.1
126.7
1426.9
930.3
358.1
544.6
127.4
1405.2
934.3
372.1
549.3
129.9
1415.8
905.4
375.5
560.6
120.2
1408.7
916.5
390.4
557.6
120.1
1402.5
991.7
378.1
558.6
141.2
1423.0
964.9
404.5
608.4
139.0
1469.5
971.4
399.1
594.5
134.7
1459.4
0.26
0.02
-0.21
-0.04
-0.56
-0.02
-0.09
-0.03
-0.04
0.25
-0.49
-0.02
0.07
-0.03
0.33
-0.29
0.13
0.00
-0.07
-0.20
2664.5
2641.7
2654.0
2600.6
2614.1
2710.0
2711.0
2721.8
-0.43
0.50
-0.13
-0.70
in Million Barrels
in Million Barrels
STOCK CHANGES
in mb/d
Sep2011
Oct2011
Nov2011
Dec2011
Jan2012*
Jan2009
Jan2010
Jan2011
1Q2011
North America
Crude
Products
696.0
0.0
696.0
0.0
696.0
0.7
696.0
0.7
696.0
0.7
703.8
2.0
726.6
2.0
726.5
2.0
0.00
-0.02
0.00
0.00
-0.33
0.00
0.00
0.01
Europe
Crude
Products
183.0
235.9
182.8
235.5
184.2
235.2
186.7
234.1
186.7
234.1
186.4
232.9
184.4
240.9
185.8
233.6
-0.01
-0.03
-0.01
0.05
-0.02
-0.01
0.04
-0.02
Pacific
Crude
Products
390.7
18.7
391.1
20.0
392.6
20.0
393.6
20.0
393.6
20.0
389.2
19.2
389.0
20.0
389.7
20.0
0.02
0.00
0.00
0.00
0.00
-0.01
0.03
0.01
1269.6
254.6
1269.9
255.5
1272.7
255.9
1276.2
254.7
1276.2
254.7
1279.4
254.0
1300.0
262.9
1302.0
255.6
0.01
-0.05
-0.01
0.05
-0.36
-0.03
0.07
0.00
1525.6
1526.7
1529.9
1532.2
1532.2
1534.4
1564.3
1559.0
-0.03
0.04
-0.38
0.07
Total OECD
Crude
Products
Total
2Q2011
3Q2011
4Q2011
* estimated
1 Stocks are primary national territory stocks on land (excluding utility stocks and including pipeline and entrepot stocks where known) and include stocks held by
industry to meet IEA, EU and national emergency reserve commitments and are subject to government control in emergencies.
2 Closing stock levels.
3 Total products includes gasoline, middle distillates, fuel oil and other products.
4 Total includes NGLs, refinery feedstocks, additives/oxygenates and other hydrocarbons.
5 Includes government-owned stocks and stock holding organisation stocks held for emergency purposes.
62
14 M ARCH 2012
T ABLES
Table 5
1
Table 5 - Total Stocks on
LandSTOCKS
in OECD
OECD Stocks
TOTAL
ON Countries/Total
LAND IN OECD COUNTRIES
('millions of barrels' and 'days')
North America
Canada
Mexico
United States4
Days Fwd2
Demand
196.5
44.5
1796.1
86
22
94
185.2
45.0
1769.5
84
22
94
189.7
46.5
1807.6
81
22
96
188.6
46.1
1780.9
88
22
95
187.8
44.4
1752.1
2059.2
87
2021.7
87
2065.9
88
2037.7
88
2006.4
86
38.1
588.3
165.4
8.2
39
121
70
51
39.1
575.4
170.2
8.0
39
147
83
53
39.5
593.2
175.2
8.2
39
137
79
56
38.2
601.1
173.6
7.9
38
125
75
53
39.9
588.7
166.8
8.3
800.0
96
792.7
111
816.0
106
820.9
99
803.6
93
19.7
33.6
21.2
26.8
27.8
168.2
286.8
34.3
15.9
9.8
133.3
0.6
125.8
20.8
65.5
22.9
8.3
133.2
32.4
36.8
58.5
88.8
77
50
117
171
127
91
122
92
119
63
92
10
129
81
123
89
109
93
94
156
101
55
19.4
37.0
21.5
21.4
26.9
167.4
289.4
33.9
17.4
10.8
131.8
0.5
125.7
21.1
62.8
23.5
9.0
132.9
33.7
36.6
58.3
92.8
77
59
106
132
133
94
124
106
124
79
90
9
124
93
109
87
111
97
101
168
85
57
19.6
38.1
21.7
21.5
27.0
166.7
290.8
32.6
17.3
10.2
130.0
0.6
117.8
23.5
64.6
23.3
8.9
130.1
32.5
37.2
56.6
84.9
70
58
109
134
130
89
114
99
118
73
88
9
114
96
105
86
104
94
101
150
73
53
18.0
36.7
20.1
22.4
27.0
160.0
282.6
30.9
16.2
11.3
130.1
0.7
114.3
24.5
65.2
21.9
8.3
131.2
32.6
37.0
56.4
84.1
73
58
109
138
130
90
117
95
112
77
91
11
115
97
110
90
103
97
104
153
83
54
19.4
36.4
20.7
22.4
28.9
165.0
282.8
27.9
15.4
10.7
128.3
0.6
101.2
25.9
64.5
21.9
8.5
132.8
31.4
35.7
55.8
86.4
Total
1371.1
97
1374.0
97
1355.4
92
1331.5
95
1322.7
96
Total OECD
4230.3
-
91
147
4188.5
-
94
146
4237.3
-
92
147
4190.1
-
92
145
4132.8
-
148
Total
Pacific
Australia
Japan
Korea
New Zealand
Total
Europe
Austria
Belgium
Czech Republic
Denmark
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Luxembourg
Netherlands
Norway
Poland
Portugal
Slovak Republic
Spain
Sweden
Switzerland
Turkey
United Kingdom
91
1 Total Stocks are industry and government-controlled stocks (see breakdown in table below). Stocks are primary national territory stocks on land (excluding utility stocks
and including pipeline and entrepot stocks where known) they include stocks held by industry to meet IEA, EU and national emergency reserves commitments and are
subject to government control in emergencies.
2 Note that days of forward demand represent the stock level divided by the forward quarter average daily demand and is very different from the days of net
imports used for the calculation of IEA Emergency Reserves.
3 End December 2011 forward demand figures are IEA Secretariat forecasts.
4 US figures exclude US territories. Total includes US territories.
5 Data not available for Iceland.
6 Reflects stock levels and prior calendar year's net imports adjusted according to IEA emergency reserve definitions (see www.iea.org/netimports.asp).
Net exporting IEA countries are excluded.
Total
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011
3Q2011
4Q2011
4206
4278
4306
4327
4205
4241
4319
4296
4230
4188
4237
4190
4133
Industry
Government
controlled
Millions of Barrels
1527
1547
1561
1564
1564
1567
1562
1549
1561
1558
1561
1526
1532
2679
2731
2745
2763
2641
2675
2757
2747
2670
2631
2676
2665
2601
Total
90
96
95
94
92
94
93
92
91
94
92
92
91
Government
Industry
controlled
2
Days of Fwd. Demand
33
35
35
34
34
35
33
33
34
35
34
33
34
57
61
61
60
57
59
59
59
58
59
58
58
57
1 Includes government-owned stocks and stock holding organisation stocks held for emergency purposes.
2 Days of forward demand calculated using actual demand except in 4Q2011 (when latest forecasts are used).
14 M ARCH 2012
63
T ABLES
Table 6
Table 6 - IEA
Member Country Destinations of Selected Crude Streams
IEA MEMBER COUNTRY DESTINATIONS OF SELECTED CRUDE STREAMS1
(million barrels per day)
Year Earlier
change
Dec 10
0.52
0.59
1.28
0.69
0.66
1.21
0.69
0.83
1.24
0.71
0.70
1.33
0.72
0.79
1.14
0.47
0.93
1.21
0.85
0.88
1.27
0.67
0.90
1.22
0.96
0.89
1.26
0.93
0.84
1.35
0.78
0.63
1.27
0.15
0.21
0.07
Saudi Medium
North America
Europe
Pacific
0.40
0.02
0.34
0.36
0.00
0.34
0.37
0.02
0.40
0.33
0.39
0.36
0.02
0.38
0.40
0.05
0.43
0.40
0.01
0.40
0.35
0.01
0.33
0.44
0.02
0.46
0.42
0.00
0.42
0.36
0.32
0.05
0.10
Saudi Heavy
North America
Europe
Pacific
0.03
0.02
0.15
0.02
0.00
0.22
0.02
0.01
0.20
0.02
0.00
0.20
0.03
0.00
0.21
0.03
0.03
0.23
0.01
0.03
0.18
0.02
0.02
0.08
0.02
0.03
0.23
0.03
0.22
0.02
0.20
0.02
0.40
0.12
0.24
0.36
0.09
0.29
0.29
0.11
0.34
0.21
0.03
0.40
0.41
0.10
0.26
0.31
0.19
0.38
0.21
0.11
0.32
0.01
0.13
0.32
0.31
0.13
0.33
0.32
0.08
0.30
0.35
0.04
0.32
-0.03
0.05
-0.01
Iraqi Kirkuk
North America
Europe
Pacific
0.06
0.31
-
0.03
0.27
-
0.07
0.27
-
0.11
0.21
-
0.07
0.31
-
0.05
0.32
-
0.06
0.26
-
0.03
0.29
-
0.03
0.20
-
0.11
0.28
-
0.06
0.20
-
0.05
0.09
-
Iranian Light
North America
Europe
Pacific
0.15
0.07
0.24
0.04
0.23
0.04
0.24
0.06
0.28
0.03
0.20
0.04
0.21
0.03
0.20
0.02
0.23
0.02
0.18
0.05
0.22
0.02
-0.03
0.03
0.40
0.57
0.49
0.52
0.55
0.51
0.34
0.63
0.59
0.41
0.73
0.51
0.54
0.49
0.58
0.51
0.60
0.48
0.46
0.46
0.43
0.57
0.03
-0.11
0.14
0.02
-
0.18
0.02
-
0.06
0.03
-
0.30
0.01
-
0.24
0.02
-
0.13
0.02
-
0.32
-
0.06
0.05
-
0.13
-
0.86
0.06
-
0.76
0.05
-
0.89
0.04
-
0.77
0.05
-
0.70
0.06
-
0.69
0.05
-
0.68
0.04
-
0.74
0.05
-
0.64
0.06
-
0.74
0.05
-
-0.10
0.01
-
Mexican Maya
North America
Europe
Pacific
0.93
0.10
-
0.91
0.11
-
0.82
0.12
-
0.82
0.14
-
0.80
0.12
-
0.84
0.12
-
0.84
0.12
-
0.84
0.11
-
0.89
0.11
-
0.78
0.13
-
0.88
0.05
-
-0.10
0.08
-
Mexican Isthmus
North America
Europe
Pacific
0.01
0.01
-
0.04
0.02
-
0.07
0.01
-
0.05
0.01
-
0.08
0.02
-
0.06
0.00
-
0.07
0.01
-
0.07
0.01
-
0.07
-
0.07
0.03
-
0.10
0.02
-
-0.03
0.02
-
Russian Urals
North America
Europe
Pacific
0.15
1.72
-
0.08
1.80
-
0.01
1.69
-
0.01
1.76
-
1.87
-
1.52
-
0.02
1.62
-
0.05
1.57
-
1.64
-
1.66
-
0.02
1.96
-
-0.30
-
Nigerian Light
North America
Europe
Pacific
0.54
0.32
0.00
0.60
0.34
-
0.53
0.46
0.05
0.62
0.40
0.05
0.60
0.40
0.04
0.43
0.54
0.06
0.46
0.48
0.05
0.75
0.39
0.06
0.33
0.51
0.05
0.30
0.56
0.04
0.72
0.42
-
-0.42
0.14
-
Nigerian Medium
North America
Europe
Pacific
0.21
0.13
-
0.25
0.09
-
0.18
0.14
-
0.20
0.14
-
0.18
0.17
-
0.18
0.11
-
0.14
0.13
-
0.17
0.10
-
0.07
0.08
-
0.19
0.22
-
0.23
0.13
-
-0.05
0.10
-
Iranian Heavy
North America
Europe
Pacific
1 Data based on monthly submissions from IEA countries to the crude oil import register (in '000 bbl), subject to availability. May differ from Table 8 of the Report.
IEA North America includes United States and Canada.
IEA Europe includes all countries in OECD Europe except Hungary. The Slovak Republic and Poland is excluded through December 2007 but included thereafter.
IEA Pacific data includes Australia, New Zealand, Korea and Japan.
2 Iraqi Total minus Kirkuk.
3 Iranian Total minus Iranian Light.
4 33 API and lighter (e.g., Bonny Light, Escravos, Qua Iboe and Oso Condensate).
64
14 M ARCH 2012
T ABLES
Table 7
2009
Crude Oil
North America
Europe
Pacific
Total OECD
2010
Year Earlier
Dec-10 % change
2011
1Q11
2Q11
3Q11
4Q11
7353 7343
6703
8893 9072
8996
6082 6249
6369
22329 22663 22067
6571
8857
6645
22072
6928
8846
6086
21860
6793
9331
6255
22379
6519
8943
6493
21955
6825
8804
6217
21846
6381
9193
6436
22010
6347
8841
6824
22012
6324
9263
6659
22536
0%
-5%
2%
-2%
LPG
North America
Europe
Pacific
Total OECD
13
260
529
802
8
270
558
836
8
311
561
879
20
313
569
903
4
284
547
836
4
304
580
888
3
341
546
890
6
344
508
858
2
362
519
882
1
317
612
930
2
323
528
853
-67%
-2%
16%
9%
Naphtha
North America
Europe
Pacific
Total OECD
22
352
841
1215
36
390
900
1326
42
292
876
1210
34
292
917
1243
51
336
830
1217
43
285
906
1234
38
257
853
1147
40
284
809
1133
59
237
898
1194
14
248
854
1116
12
407
837
1257
14%
-39%
2%
-11%
Gasoline
North America
Europe
Pacific
Total OECD
878
193
96
1167
788
174
64
1025
752
216
73
1040
669
223
71
963
981
221
61
1262
703
216
70
989
655
203
90
948
612
193
83
887
749
265
86
1101
606
153
101
860
660
193
62
915
-8%
-20%
62%
-6%
62
452
53
567
76
417
40
532
73
398
50
521
62
320
58
440
86
367
43
497
81
451
45
578
64
450
55
569
65
451
65
580
96
554
59
709
31
349
42
423
60
358
45
463
-48%
-3%
-6%
-9%
Gasoil/Diesel
North America
Europe
Pacific
Total OECD
55
1035
87
1177
49
1045
97
1191
33
1001
129
1163
46
1078
99
1224
30
931
153
1114
32
934
123
1089
23
1063
140
1226
5
1155
146
1306
52
1096
117
1266
11
940
156
1107
30
1081
93
1205
-63%
-13%
68%
-8%
270
534
113
917
277
529
117
923
266
579
146
990
345
505
147
997
304
582
111
997
193
651
156
1001
222
576
169
967
206
657
142
1005
250
548
184
982
211
522
182
915
231
542
102
874
-8%
-4%
79%
5%
Other Products
North America
Europe
Pacific
Total OECD
870
770
325
1964
805
666
335
1807
871
704
326
1901
855
683
383
1921
896
776
252
1924
903
724
343
1970
828
632
327
1787
747
665
316
1728
832
649
301
1782
905
582
364
1851
873
737
362
1972
4%
-21%
1%
-6%
Total Products
North America
Europe
Pacific
Total OECD
2171
3595
2045
7810
2038
3491
2110
7639
2044
3500
2161
7705
2033
3415
2244
7691
2355
3497
1995
7847
1960
3566
2223
7749
1832
3522
2181
7535
1681
3748
2068
7498
2041
3712
2164
7917
1780
3111
2311
7203
1869
3642
2029
7539
-5%
-15%
14%
-4%
9524 9381
8747
12488 12562 12496
8127 8360
8530
30139 30302 29773
8604
12271
8888
29764
9283
12344
8081
29708
8753
12897
8478
30128
8351
12465
8674
29490
8506
12552
8285
29344
8421
12905
8600
29927
8127
11952
9135
29215
8483
12905
8688
30076
-4%
-7%
5%
-3%
Total Oil
North America
Europe
Pacific
Total OECD
1 Based on Monthly Oil Questionnaire data submitted by OECD countries in tonnes and converted to barrels.
2 Excludes intra-regional trade.
3 Includes additives.
14 M ARCH 2012
65
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