PRICES: THE FASTEST GROWTH
Global oil demand in 2015 is expected to grow by 1.6 mb/d, up 0.2 mb/d from our previous Report and the fastest pace in five years, as economic growth solidifies and consumers respond to lower oil prices. Persistent macro-economic strength supports above-trend growth of 1.4 mb/d in 2016.
World oil supply fell nearly 0.6 mb/d in July, mainly on lower non- OPEC output. OPEC crude production held steady near a three-year high. As lower prices and spending cuts take a toll, non-OPEC supply growth is expected to slow sharply from a 2014 record of 2.4 mb/d to 1.1 mb/d this year and then contract by 200 kb/d in 2016.
OPEC crude supply inched 15 kb/d lower in July to 31.79 mb/d as Saudi output eased and offset record high Iraqi production and increased Iranian flows. The 'call on OPEC crude and stock change' rises to 30.8 mb/d in 2016, up 1.4 mb/d on this year due to a stronger demand outlook and stalling non-OPEC supply growth.
OECD inventories rose counter-seasonally by 9.9 mb to hit another all-time high of 2 916 mb in June with their surplus to average levels widening to a record 210 mb. As the seasonal restocking of 'other products' continued apace, refined products by end-month covered 31.3 mb days of forward demand, 0.2 days above end-May.
Global refinery runs reached a record 80.6 mb/d in July, 3.2 mb/d up on a year earlier, but fissures are showing. High distillate stocks have pushed cracks in Singapore down to their lowest level since 2009 and prompted run cuts in Asia. Elsewhere, especially in the US, still-soaring gasoline cracks supported high margins and throughput.
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BLOOMBERG - The Saudis see atomic energy as a way to ease their dependence on finite fossil fuels. But they are also driven by competition with their rival Iran, which has multiple nuclear facilities.
PLATTS - The Russian energy ministry said there are many pilot projects introducing blockchain to Russia's energy sector in the development and discussion stage, which could have a "potentially significant" impact on optimizing oil and gas companies' costs.
ROSNEFT - Net income attributable to Rosneft shareholders reached RUB 100 bln in 4Q 2017, more than doubling QoQ. In 12M 2017 it amounted to RUB 222 bln, exceeding the 2016 level by 27.6%.
AOG - Total contributed a participation fee of $1.15bn to enter the Umm Shaif and Nasr concession and a fee of $300mn to enter the Lower Zakum concession. Both concessions are operated by ADNOC Offshore, a subsidiary of ADNOC, on behalf of all concession partners.