The Organization of the Petroleum Exporting Countries (OPEC) in its 2011 World Oil Outlook increased its estimate of supplies, saying the amount of unused oil production that the 12-member group holds in reserve in case of supply shocks, would double by 2015. It is expected that world oil demand will rise to 92.9 million barrels per day by 2015 in OPEC’s reference case presented in the report, up 1.9 million barrels per day from last year’s forecast. Actual oil demand averaged 86.8 million barrels per day in 2010.
OPEC nations pump more than a third of the world’s oil. “It is worth stressing that risks appear skewed towards the downside, especially since the sovereign debt crisis in some EU countries seems to be spreading and the world economy slowing down further, with potential consequences for the global financial system,” OPEC said. The report also added that the increased political uncertainty in Italy, Europe’s third largest economy, has added to the turmoil in Europe.
OPEC’s report looks out to the year 2035, when it expects world oil demand to reach almost 110 million barrels per day in the reference case. Last year’s report stopped at 2030, when it foresaw demand of 106 million barrels per day. “By 2035, the amount of OPEC crude needed will be less than current levels”, under that scenario, the report said. “This means that OPEC upstream investment requirements are subject to huge uncertainties.”
US commercial oil inventories fell by 13.4 million barrels in September. This drop was attributedto crude which dropped by 16.8 million barrels, while product inventories rose by 3.4 million barrels. Despite the drop, total US commercial oil inventories stood at almost the same level as the five-year average. The most recent monthly data for August shows that commercial oil inventories in Japan fell by 1.4 million barrels.
Opec reported the global growth expectations for 2011 and 2012 now stand at 3.6% and 3.7%respectively. Growth for China remains unchanged at 9.0% in 2011 and 8.5% in
2012, while India’s forecast for 2011 has been revised down by 0.1 percentage pointsto now stand at 7.6% for both 2011 and 2012.