See From Commodity Property Crude Oil Price Will Run High
Author: Sep 16, 2011 08:48
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Crude oil is the wind vane of bulk goods for its strong financial attributes. Crude oil price may be pushed up or be curbed by the market price fluctuation, but the main price will not deviate from its supply and demand situation.
1. On supply: there is no big change
Firstly, OPEC member countries’ supply situation
EIA estimate, OPEC crude oil daily output will reduce 360 thousand barrel, mainly for the production break off of Libya. IEA indicates that there will be a long time before Libyan production recovery for its difficult recover course and there is also a long way to go for the international oil market recovery. OPEC daily average output will reduce from 4 million barrel in 2010 to 3.5 million in 2011. Kuwait petroleum and parliamentary affairs minister Muhammad said, on 12th, on order to stabilize the international oil price, Kuwait will increase its daily output to 2.9 million barrel from September this year. And its production is also expected to reach 3 million barrel, which is far over the 2.2 million barrel that specified by OPEC. In fact, Kuwait and Saudi Arabia have already increased its crude oil production in August, in case of a negative affect to the global economy brought by the over speed increase of international oil price. Kuwait August crude oil daily output was 2.8 million barrel.
Secondly, the non-OPEC member countries’ supply situation
EIA estimate, non-OPEC member countries’ crude oil and liquid fuel daily output will increase by 500 thousand barrel and 770 thousand barrel respectively. By 2012, the total daily output will come up to 53.1 million barrel. In 2011 and 2012, countries output increased the most is Brazil, Canada, China, Columbia, Kazakhstan, and America. The average daily output increase amount is over 10000 barrel. On the contrary, crude oil output next year of Russia will reduce about 120 thousand barrel. Moreover, the daily output of North Sea area will reduce 130 thousand barrel, 110 thousand barrel respectively. Moreover, EIA assumes, output of Yemen will be recovered to the level that was before its war by early of next year(240 thousand barrel), but the political unsettlement of Syria, and the latent punishment to its Department of Energy will lead to another political risk to the non-OPEC member countries.
Thirdly, crude oil stock situation
EIA estimates, in 2011 and 2012, OECD crude oil commercial stock level shows a downward trend. Stock consumption days will be shrank slightly, but will continue to stay at the high level. The data will reduce from 58 days in the fourth quarter of 2010 to 57 days in the fourth quarter this year. And by the end of 2012, the days will further reduced to 56 days.
2. On demand: Depressed economy and demand reduced
OPEC determines to down regulate the global crude oil daily amount by 150 thousand barrel, from 88140 thousand barrel to 87990 thousand barrel and also down regulate global crude oil daily needs expectation by 40 thousand barrel, to the level of 1270 thousand barrel per day. The reason for its down regulation is mainly for the depressed global economy, and lack of power to recovery, especially for the low demand of western industrial countries. Meanwhile, the unoptimistic consumption to the global economic growth. EIA assumes the global crude oil growth rate will be slowed down. On 7th September, EIA published its September energy outlook, including crude oil, gasoline, diesel oil, natural gas, electricity, coal and other energies like that, demonstrated its energy supply and demand situation. In compare with the last month forecast data, EIA greatly down regulated the global economic growth rate. According to the forecast of the report, GDP growth rate of America in the year and the next year will be 3.4% and 4.1% respectively. For the economic growth rate slowed down, and petroleum consumption slowed down, EIA forecast, the average crude oil cost of American oil refineries will increase from $100/bbl in 2011 to $103/bbl in 2012, but which is still lower than the last month forecast of $107/bbl.
To sum up, although petroleum demand growth range down regulated, which will easy the tight supply and demand situation, its supply problem still exist. International oil downward room is limited. Crude oil price is likely to fluctuate at a high level.
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Editor: Candy From: 168Tex.com
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