Global oil supply has seen a notable increase, climbing by 290,000 barrels per day in October, reaching approximately 102.9 million barrels daily. This rise is largely attributed to Libya resuming crude production, offsetting declines from other producers like Kazakhstan and Iran. Despite these gains, OPEC+ has delayed lifting voluntary production cuts until January 2025, aiming to stabilize market conditions amidst economic uncertainties.
Demand Dynamics: A Mixed Picture
Global oil demand is projected to grow by 920,000 barrels per day in 2024, significantly lower than last year’s surge of nearly 2 million barrels per day. Weak economic conditions, particularly in China, have led to a notable demand contraction. Conversely, advanced economies have shown a slight recovery in demand, primarily driven by increased transportation needs.
Geopolitical and Market Influences
Brent crude oil prices exhibited volatility in October, peaking at $80.90 per barrel due to heightened Middle Eastern tensions before stabilizing at around $73 per barrel. While speculative trading remains subdued, attention is now shifting to fundamentals, including the unwinding of OPEC+ cuts and increased output from non-OPEC+ countries like the U.S., Canada, and Guyana.
Refinery Margins and Inventory Trends
Refinery margins improved in October following seasonal maintenance, with global refinery runs projected to recover further into 2025. Additionally, oil inventories fell sharply, with OECD stocks hitting their lowest levels since January 2024, reflecting tightening market conditions.
Key Regional Highlights
- United States: The U.S. continues to lead non-OPEC+ supply growth, bolstered by increased production from shale plays and offshore developments.
- China: Persistent economic challenges have dampened demand, with six consecutive months of contraction reported in 2024.
- India: Emerging as a key driver of global consumption growth, India is expected to account for 25% of oil demand increases through 2025.
Published: Nov.29, @Aran
