Energy Preview: OECD Commercial Crude Oil Stocks Fall Further Says OPEC

16 Mar 2022 , 09:06 AM

OPEC noted in a monthly report that world oil demand growth in 2021 is revised up by 0.05 mb/d, reflecting the actual data across the regions, to now stand at 5.7 mb/d. The 4Q21 figure for all OECD region is revised higher, as a result of the better performance. The OECD in 2021 increased by 2.7 mb/d, while the non-OECD showed growth of 3.1 mb/d. Given the recent developments and the extremely high uncertainty surrounding global macroeconomic performance, the 2022 forecast for global oil demand growth remains under assessment at 4.2 mb/d, with OECD forecast at 1.9 mb/d and non-OECD at 2.3 mb/d. However, this forecast is subject to change in the coming weeks, when there is more clarity on the far-reaching impact of the geopolitical turmoil.

The conflict in Eastern Europe has added more downside risk to the performance of world economy in 2022. So far, and in addition to the ongoing pandemic, the conflict has led to a number of key issues including rising commodity prices, which are further escalating global inflation. The effects of the conflict, especially the impact of rising inflation, if sustained, will lead to a decline in consumption and investments to varying degrees.

Demand for OPEC crude in 2021 was revised up by 0.1 mb/d from the previous month’s assessment to stand at 28.0 mb/d, which is around 5.0 mb/d higher than in 2020. In contrast, demand for OPEC crude in 2022 was also revised up by 0.1 mb/d from the previous month’s assessment to stand at 29.0 mb/d, which is around 1.0 mb/d higher than in 2021. OECD commercial stocks fell, m-o-m, by 0.7 days in January, to stand at 59.3 days. This is 11.6 days below January 2021 levels, 6.2 days less than the latest five-year average, and 2.8 days lower than the 2015-2019 average.

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