Jakarta – Global oil demand growth is showing signs of slowing, with a notable increase of 870 kilo barrels per day (kb/d) in the second quarter of 2024, the International Energy Agency (IEA) announced on its website.
The IEA’s August Oil Growth Report cited that growth has been tempered by economic challenges, particularly in China, where a contraction has limited gains. Demand is expected to rise by less than 1 million barrels per day (mb/d) in both 2024 and 2025, a significant slowdown compared to last year’s robust 2.1 mb/d growth.
The report highlights that as world oil supply rose by 230 kb/d in July to reach 103.4 mb/d, driven by a significant increase from OPEC+ that offset declines in non-OPEC+ production, annual supply growth is forecast to accelerate from 730 kb/d in 2024 to 1.9 mb/d in 2025, with non-OPEC+ production expected to increase by 1.5 mb/d both this year and next. OPEC+ output, on the other hand, may fall by 760 kb/d in 2024 but could rise by 400 kb/d in 2025 if voluntary cuts remain in place.
Refinery throughputs globally are forecast to increase by 840 kb/d to 83.3 mb/d in 2024, and by 600 kb/d to 83.9 mb/d in 2025. Despite this, margin weakness continues to affect processing rates, with declines anticipated in Chinese refineries year-on-year. While margins fell further in Europe in July, they rose in Singapore and on the US Gulf Coast, driven by stronger naphtha and gasoline prices.
Global oil inventories saw a decline of 26.2 million barrels in June after four months of consecutive builds totalling 157.5 mb. OECD onshore stocks fell by 19.5 mb, offset slightly by a 17.5 mb increase in non-OECD countries. Oil stored on water also decreased for the third consecutive month, by 24.2 mb, while OECD industry inventories were down by 21 mb, in line with seasonal expectations. (nsh)
