Tug boats transport the Chevron Corp Jack St Malo semi-submersible drilling and production platform to the Gulf of Mexico from Kiewit Offshore Services in Ingleside, Texas (file). The non-Opec oil supply is expected to increase by 1.36mn bpd in 2015 to average 57.31mn bpd, according to a report.
By Santhosh V Perumal/Business Reporter
The non-Opec (Organisation of Petroleum Exporting Countries) oil supply is expected to increase by 1.36mn barrels per day (bpd) in 2015 to average 57.31mn bpd, according to Global Investment House.
The new supply level is taking in to consideration after an upward revision 0.12mn bpd, Global said in a report.
“The strong growth trend seen in 2014 is expected to continue into 2015 but at a slower pace, supported by OECD (Organisation for Economic Co-operation and Development) Americas, Latin America and China, and partly offset by declines in the FSU (former Soviet Union) and Africa,” the report said, adding the forecast is associated with a high level of risk.
“While the expectation of capital expenditure in 2014 and 2015 indicates a rising trend, other risk factors, such as geopolitics, the environment, fiscal regimes, oil policies, prices and technical developments, will continue to impact supply growth expectations,” it added.
Non-Opec supply is expected to experience an increase of 2.2mn bpd of gross capacity addition in 2015. On the demand side, Global said in 2015, projected growth was revised lower by 0.07mn bpd from last month’s report to settle at 1.12mn bpd.
Downward adjustments took place in OECD Europe, Asia-Pacific, as well as in Latin America, leading to expected total world oil consumption of 92.26mn bpd, it said.
The estimate for oil demand growth in 2014 has been revised down by 0.12mn bpd from the last monthly oil market report (MOMR) of Opec to stand at 0.93mn bpd. Oil demand growth in the OECD region has been trimmed down by 0.09mn bpd, it said, adding estimated non-OECD oil demand also experienced a downward revision, by 0.03mn bpd, largely due to less than expected oil consumption in other Asia and the Middle East.
Total estimated demand in 2014 is estimated to be at 91.13mn bpd down from 91.19mn bpd in the last report. Opec has revised its 2014 non-Opec supply estimate growing 1.72mn bpd to reach a level of 55.95mn bpd. Upward revisions came from most of the main suppliers in November.
The US, Russia and Latin America all witnessed upward revisions from the last MOMR. The US production was revised up 0.04mn bpd; while Russia and Latin America received a 0.02mn bpd and 0.03mn bpd upward revisions respectively. However, China is expected to keep its production in line with last year’s average of 4.24mn bpd after it received a downward revision of 0.02mn bpd.
The Opec has decided not to reduce oil production, despite a huge oversupply in world markets. Following a meeting in Vienna in November last year, it left its combined oil production unchanged at 30mn bpd.Saudi Arabia blocked calls from poorer members of the oil exporter group for production cuts with Iraq being the main provider of increases in Opec’s oil production; all of the GCC (Gulf Co-operation Council) members decreased their production. Saudi Arabia, Kuwait, the UAE and Qatar saw a production cuts amounting to 158,800 barrels a day in total.