Asia/Pacific News
Bunker Prices Set to Remain Under Pressure as IEA Notes First Signs of a Slowdown in Global Oil Demand
The International Energy Agency (IEA) in its latest Oil Market Report for December has predicted 2016's growth in world oil demand will be 1.2 million barrels per day (bpd), which it characterized as the "first signs of a slowdown."
The monthly publication went on to note that growth for the current quarter is easing to 1.3 million barrels per day (bpd) from a peak of 2.2 million bpd for the last quarter.
The news means bunker prices, which in recent days have slumped to their lowest in over 11 years in some of the primary ports, are set to remain under pressure over the next year.
According to the IEA report, 2015's growth of 1.8 million bpd is led by China, the U.S., India, and Europe.
Ship & Bunker last week reported that the Organization of the Petroleum Exporting Countries (OPEC) said its November output was higher than that of any month in the past three years, and the EIA noted November's 50,000 bpd increase in global oil supply was attributed to higher OPEC output: the 96.9 million bpd total is 1.8 million bpd higher than a year earlier.
Meanwhile, non-OPEC annual growth "slowed to below 300 kb/d from 2.2 million bpd at the start of 2015."
IEA predicts that global inventories will build until at least late 2016, but at a much slower pace than what occurred in 2015.
"New and spare storage capacity should be able to accommodate the projected extra 300 million barrels of stocks," it said.
IEA earlier warned that weak oil prices are discouraging conventional oil supply investment in non-OPEC countries, and in November it predicted that sluggish global growth could result in $50 oil through to 2020.
