Global oil supply has continued to outpace the strongest demand in five years, leaving global oil stockpiles at a record 3bn barrels, IEA said in its November Oil Market Report.
OPEC October crude output held steady at 31.76mn b/d, IEA said, with higher output in Saudi Arabia, Libya and Nigeria offsetting declines in Iraq and Kuwait. Non OPEC supply however is expected to fall by more than 0.6mn b/d next year. Refinery runs globally sank 1.2mn b/d in October to 78.2mn b/d meanwhile as seasonal maintenance got into its stride, with refinery margins still strong despite edging lower MoM.
IEA highlighted surging distillate inventories as strong US and Chinese crude runs have butted up against faltering economic fundamentals across much of the world. Between February and August, OECD middle distillate stocks rose by over 84mn bl, IEA said to stand at 600mn bl by the end of August, the highest since 2010.
“The current forecast is for a mild winter in Europe and the US. If it turns out to be true, bulging stock levels will add further pressure and oil market bears may choose not to hibernate,” IEA said.
MS – 13/11/2015