According to the latest December report published by the Organization of the Petroleum Exporting Countries regarding the recent changes in the crude oil market for November, the OPEC oil production slightly declined again during November compared with October’s oil production.
OPEC’s crude oil production decreased to 30,781 thousand bbl/d in November compared with 30,989 thousand bbl/d in October. This means the total OPEC oil supply slightly declined by 207.7 thousand during the previous month. Nigeria’s oil production declined by 101 thousand bbl/d to 1,854 thousand bbl/d. UAE’s oil production also slightly declined by 54.5 thousand bbl/d to reach 2,592 thousand bbl/d. The current production of Libya is still nearly 5% below Libya’s average oil production of 1,600 thousand bbl/d in 2010. Saudi Arabia’s oil production remained stable at 9,673 thousand bbl/d. Iran’s oil production also remained stable at 2,683 thousand, which is still its lowest production level in recent years.
The rest of OPEC countries also nearly didn’t change their oil quotas during November 2012.
The oil supply of non-OPEC countries was revised slightly down to an estimate of 52.93 million bbl/d in 2012, a rise of 0.48 million bbl/d compared with 2011’s oil supply. The estimated growth in non-OPEC oil supply in 2013 is 53.83 million bbl/d.
Assuming that during the year OPEC’s supply will remain for the rest of the year at the same level as during the first eleven months of 2012 at 31.23 million bbl/d and adding to that OPEC’s NGL’s and non-conventional oil at an estimate of 5.75 the total global supply will reach in 2012 an estimate of 89.91 million bbl/d.
The total world oil demand forecast for 2012 is estimated to reach 88.8 million bbl/d – a growth of 0.76 million bbl/d or less than 1% compared with 2011’s demand.
For 2013, based on the above figures and assuming OPEC’s supply will remain as in 2012, and adding to that OPEC’s NGL’s and non-conventional oil at an estimate of 5.99, then the total supply will reach 91.05 million bbl/d. The total world oil demand forecast for 2013 is estimated to reach 89.57 million bbl/d – a growth of 0.77 million bbl/d or less than 1% compared with 2012’s demand.
The estimated gap between supply and demand on a global will reach during 2013 a total of 1.48 million bbl/d (i.e. a surplus of 1,480 thousand barrels). Note: this figure was lower in previous months. Therefore, if the difference between the supply and the demand with further expand it could suggest that the oil market with further loosen in the months to follow, which could pressure down the prices of oil.
Nonetheless keep in mind, if OPEC were to cut its oil production (mainly Iran) to the 30 million bbl/d agreed upon quota, this would likely tighten the oil market and pressure up oil prices. OPEC’s Summit will be held tomorrow.
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