Page 113 - RusRPTNov23

9.1.1b Oil sector news
● Production
The International Energy Agency (IEA) has made significant adjustments to its oil demand growth forecast for 2024, citing evidence of demand reduction following the surge in global oil prices that persisted throughout September.
According to the latest Oil Market Report (OMR) from the Paris-based agency, the projected demand growth for 2024 now stands at 880,000 barrels per day (b/d), down from the previous estimate of 990,000 b/d. However, for the current year, the IEA has slightly increased its demand growth forecast to 2.3mn b/d, up from 2.2mn b/d. This adjustment is based on robust demand performances in major centers such as China, India, and Brazil.
The report says there is evidence of substantial demand destruction, particularly in lower-income countries like Nigeria, Pakistan, and Egypt. Moreover, there are signs of accelerating declines in certain OECD markets, notably the United States.
Despite these fluctuations in demand, the IEA has left its supply forecasts unchanged, projecting growth rates of 1.5mn b/d and 1.7mn b/d for the current year and 2024, respectively. The agency attributes this stability to voluntary supply cuts implemented by OPEC+ members, including Saudi Arabia and Russia, which are expected to maintain the oil market in a deficit.
The IEA's report notes a significant drawdown in global observed inventories in August, amounting to 63.9mn barrels, with crude stocks decreasing by 102.3mn barrels. This marks the lowest inventory level recorded since at least 2017. Preliminary data suggests a continuation of this drawdown from land storage in September, underscoring the ongoing dynamics in the global oil market.
The Israel-Hamas conflict has had "no direct impact on oil flows", it said, but has added geopolitical risk in a region crucial for oil supplies, meaning "markets will remain on tenterhooks as the crisis unfolds".
The Joint Ministerial Monitoring Committee (JMMC) of the OPEC+ alliance confirmed on October 4 commitment to the current oil output deal conditions, which means retention of the current output quotas, the committee said in a statement. "The committee reaffirmed the commitment of its member countries to the Declaration of Cooperation (DoC) which extends to the end of 2024 as agreed in the 35th OPEC and non-OPEC Ministerial Meeting (ONOMM) on 4th of June 2023," the statement read. The next meeting of the committee was slated for November 26.
113 RUSSIA Country Report November 2023 www.intellinews.com