Page 100 - Russia OUTLOOK 2024

The extension of OPEC+ output cuts to the end of 1Q24 did little to prop up oil prices. By early December they had tumbled by about $25/bbl from September’s highs to their lowest levels in six months. At the time of writing, Brent futures were trading around $74/bbl and WTI close to $69/bbl.
The OPEC raised its forecast for global oil demand growth in 2023 by 100,000 bpd in December and now expects its consumption to increase by 2.5mn bpd, to 102.1mn bpd, the organisation’s report says. Previously, OPEC expected demand to grow by 2.4mn bpd for three months in a row.
The voluntary reductions are calculated from the respective countries' 2024 output targets, which were set in June. They are in addition to a previous round of voluntary cuts announced in April.
The latest reductions comprise a 223,000 bpd cut from Iraq, 163,000 bpd from the UAE, 135,000 bpd from Kuwait, 82,000 bpd from Kazakhstan, 51,000 bpd from Algeria and 42,000 bpd from Oman, according to the OPEC Secretariat.
In addition, Russia said it would cut its oil exports by 300,000 bpd in the first quarter next year compared with May-June 2023 levels but in December said that it might cut an additional 50,000 bpd.
Record-breaking supply from the United States, Brazil and Guyana, and sharply higher Iranian oil production, along with easing demand, prompted some OPEC+ members to announce more extensive 1Q24 cuts to fend off a potential inventory build.
Crude production by non-OPEC countries may rise by 1.8mn bpd in 2023, with the US contributing much to the growth, OPEC said in its November report. The outlook thus has been upgraded by 100,000 bpd compared with the previous estimate. In absolute terms output may reach 67.6mn bpd this year.
In August, the US’ crude production hit an all-time high as it slightly surpassed the previous peak of 13mn bpd recorded in November 2019. As a result, total production of liquid hydrocarbons could grow to 21.2mn tonnes in August, which means growth by 1.7mn bpd in annual terms.
The 2024 projections remained unchanged as OPEC expects non-OPEC countries’ supply to rise by 1.4mn bpd to an average of 69mn bpd, with the US, Canada, Guyana, Brazil, Norway and Kazakhstan being the main drivers of expected growth, while Mexico and Malaysia likely to demonstrate the highest drop in production.
Shadow fleet and sanctions busting
Russia’s reliance on Western transport services was falling in the second half of 2023 as the West attempted to tighten its oil prices sanctions cap noose.
In its December Russian chartbook, KSE reported:
· In October-November, more than 99% of seaborne crude oil exports appear to have been sold above $60/barrel.
100 Russia OUTLOOK 2024 www.intellinews.com