In its Monthly Oil Market Report for March, the Organization of Petroleum Exporting Countries (OPEC) said that falling demand in Europe has flattened out, while demand from Asia remains high enough to offer some stability to the market. Global demand growth for 2012 is unchanged from February’s report, up 900,000 barrels/day, to around 89 million barrels/day.
Non-OPEC supply is estimated to grow by 610,000 barrels/day to an average of nearly 53 million barrels/day in 2012. OPEC crude production, according to non-OPEC sources, totaled nearly 31 million barrels/day in February. OPEC estimates that its production of non-conventional oil and natural gas liquids will be 5.65 million barrels/day in 2012. The combined global supply, then, is just under 90 million barrels/day.
The near-identical estimates for demand and supply mean that prices are not likely to moderate unless factors other than production ease off. For example, tensions between the West and Iran or fighting in Nigeria could reduce prices even absent higher production.
The OPEC report for March is available here.
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