13 September 2011

HIGHLIGHTS

Uncertain global economic and financial prospects underpinned

volatile oil futures prices in August and early September. WTI and
Brent followed divergent paths last month, with the price spread
hitting record levels of over $27/bbl in early September. Prices at
writingwere$111/bblforBrentand$86/bblforWTI.

Global oil demand is revised down by 0.2mb/d for 2011 and by

0.4mb/d for 2012 on lower nonOECD readings and reduced
economic growth expectations. Global GDP growth is now seen at
3.9% in 2011 and at 4.2% in 2012 with significant downside risks.
Demandestimatesnowstandat89.3mb/din2011(+1.0mb/dyoy)
and90.7mb/din2012(+1.4mb/dyoy).

World oil supply rose by 1.0mb/d in August, to 89.1mb/d, with

nonOPEC production up by 0.8mb/d. Rising US and LatinAmerican
productionoffsetheavymaintenanceandfieldoutagesintheNorth
Sea. NonOPEC supply has been revised lower to 52.8mb/d in 2011
onoutagesintheMiddleEastandChina,risingto53.8mb/din2012.

August OPEC crude oil output was up by 165kb/d, to 30.26mb/d

with production still 1.04mb/d below the 31.3mb/d 3Q11 call on
OPECcrudeandstockchange.However,thecallfor4Q11hasbeen
loweredby0.2mb/dto30.5mb/d,duetoweakerdemand.Withthe
end of Libyas civil conflict on the horizon, we have revised up our
Libyancapacityoutlookfor4Q11by0.1mb/d,to0.3mb/d.

Global refinery crude runs have been revised down by close to

0.3mb/d for both 3Q11 and 4Q11 in light of the weaker demand
outlook and higher outages scheduled for a number of countries.
Global throughputs are now seen rising 1.7mb/d in 3Q11 versus
2Q11,to75.6mb/dandaveraging75.4mb/din4Q11.

OECD industry oil inventories rose by 10.8mb to 2 687mb, or to

58.4daysofforwarddemand,inJuly.Stocksfellbelowthefiveyear
average for the first time since the economic recession of 2008.
PreliminarydataindicateOECDstocksremainedtightinAugust,rising
byamodest0.6mb.

TABLE OF CONTENTS
HIGHLIGHTS....................................................................................................................................................................................... 1
THE DEMAND PRICE PARADOX? ........................................................................................................................................... 3
DEMAND ............................................................................................................................................................................................. 4
Summary........................................................................................................................................................................................... 4
Global Overview ............................................................................................................................................................................ 4
OECD ............................................................................................................................................................................................... 6
North America .......................................................................................................................................................................... 7
Europe ......................................................................................................................................................................................... 8
Pacific ........................................................................................................................................................................................... 9
Non-OECD ................................................................................................................................................................................... 10
China .......................................................................................................................................................................................... 11
Other Non-OECD.................................................................................................................................................................. 12
As Fighting Subsides, Libyan Oil Demand Set to Rebound ...................................................................................... 13
SUPPLY ................................................................................................................................................................................................ 14
Summary......................................................................................................................................................................................... 14
OPEC Crude Oil Supply ............................................................................................................................................................. 15
Short-Term Oil Supply Prospects in Libya as Endgame Nears ...................................................................................... 17
Non-OPEC Overview ................................................................................................................................................................. 19
OECD ........................................................................................................................................................................................ 20
North America .................................................................................................................................................................. 20
North Sea............................................................................................................................................................................ 21
Pacific ................................................................................................................................................................................... 21
Non-OECD Asia ...................................................................................................................................................................... 22
Leak at ConocoPhillips Peng Lai 19-3 field to reduce 2H2011 Chinese output ................................................. 22
Former Soviet Union (FSU) ................................................................................................................................................... 23
Other Non-OECD .................................................................................................................................................................. 25
New EU Sanctions on Syria Unlikely to Affect Syrian Crude Oil Production ..................................................... 26
OECD STOCKS ................................................................................................................................................................................ 27
Summary......................................................................................................................................................................................... 27
OECD Inventory Position at End-July and Revisions to Preliminary Data ............................................................. 27
IEA Libya Collective Action: Oil from Government Stocks Relieving the Market ......................................................... 29
Analysis of Recent OECD Industry Stock Changes .............................................................................................................. 29
OECD North America........................................................................................................................................................... 29
OECD Europe.......................................................................................................................................................................... 30
OECD Pacific ........................................................................................................................................................................... 31
Recent Developments in China and Singapore Stocks ......................................................................................................... 32
PRICES ................................................................................................................................................................................................. 34
Summary......................................................................................................................................................................................... 34
Market Overview ......................................................................................................................................................................... 34
Commodity Index Traders -- The New Whipping Boys?.................................................................................................... 38
Spot Product Prices ..................................................................................................................................................................... 42
Refining Margins ............................................................................................................................................................................ 43
End-User Product Prices in August .......................................................................................................................................... 45
Freight ............................................................................................................................................................................................. 45
REFINING ........................................................................................................................................................................................... 47
Summary......................................................................................................................................................................................... 47
Global Refinery Overview .......................................................................................................................................................... 47
OECD Refinery Throughput...................................................................................................................................................... 49
Another Refiner Bows Out - Sunoco Announces Refinery Exit ................................................................................... 50
Non-OECD Refinery Throughput ............................................................................................................................................ 52
Implications of Russian Tax Changes on Refining More Long Term ............................................................................ 54
Libyan Refinery Status ............................................................................................................................................................ 55
OECD Refinery yields ................................................................................................................................................................. 55
TABLES................................................................................................................................................................................................ 57

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

M ARKET O VERVIEW

THE DEMAND PRICE PARADOX?

Market observers are puzzling over the paradox of weakening economic growth and oil demand
indicatorsontheonehand,and$110/bblcrudeontheother.Noteveryoneispaying$110/bblofcourse,
and refiners with ready pipeline access to heavily discounted crude in the US Midwest are enjoying
bumpermargins,unliketheirbrethreninEuropeandelsewhere.WTIasidehowever,benchmarkBrent
crude since early May has seesawed in a range of between $105 and $120/bbl. True, the IEA Libya
CollectiveActioninlateJune,andthebroaderequityandcommodityselloffseeninearlyAugustcaused
pricestoplungebyaround$10/bbleachtime.Butpriceshavestubbornlyreclaimedlost groundagain
withinweeks,raisinganewquestionsaboutthekeydriversofprices.

mb/d

Oil Demand Growth Wanes with

Economic Downgrades

2.0
2011

2012

mb

OECD Industry Total Oil Stocks

Relative to Five-Year Average

200
150

1.5

100
50

1.0

0
0.5

-50

0.0
June OMR July OMR Sep OMR - Sep OMR base
low

-100
Jul 09
Jan 10
Pacific
Europe

Jul 10

Jan 11
Jul 11
North Am erica
OECD

Therearecertainlygrowingconcernsaboutthehealthoftheglobaleconomy.Governmentdebtinthe
OECD and the spectre of inflationary pressures and currency protectionism in emerging markets raise
fearsthatexpectationsofbusinessasusual4.55%worldGDPgrowthareunsustainable.OurownGDP
assumptionsfor2011and2012arethismonthscaledbacknearerto4%annualgrowth,withthebulkof
thedowngradefocusedontheOECDcountries.Oildemandgrowthistrimmedasaresult,nowaveraging
1.0mb/dthisyearand1.4mb/dnext.RepeatingthestilllowerGDPsensitivityofJunesMTOGM,which
cuts a further onethird off GDP growth looking forward, oil demand growth slips to a much weaker
0.7mb/dand0.4mb/din2011and2012respectively.Thislattercaseisnotourmostlikelyprognosis,
butthefinancialandeconomicheadwindsarenonethelessgatheringmomentum.

However,thepotentialforslightlyeasiermarketfundamentalsinthemonthsaheadneedstobeviewed
against a backdrop of an actual and pronounced tightening in the market evident since mid2010.
Demandstrengthin2H10sawconsumptionrunningaheadofsupplytothetuneofnearly1.4mb/d.The
focus has now switched more to supply, amid slowing demand growth in 1H11, with both the Libyan
disruptionandtemporary,butwidespread,nonOPECoutagesleadingtoacontinuedmarkettightening.
Weestimatethatsupplylaggeddemandbyover0.5mb/din1H11,andJulyandAugusthavealsoseen
OECD industry stocks fall below the fiveyear average for the first time since June 2008. Add in the
quality dimension, whereby supply outages have overwhelmingly been concentrated in lightsweet
grades,andtheflipofBrentintobackwardationaftermanymonthsofcontangoseemsperfectlylogical.

Our underlying call on OPEC crude and stock change for 3Q11 now stands at 31.3mb/d, and for the
nextthreequarterslookslikelytoaveragebetween3030.5mb/d,nearrecentOPECoutputlevels.That
suggests that the recent spell of market tightening could moderate in the short term, assuming that
recent supply disruptions also recede. News from Libya at the time of writing that oil production has
begunonceagainisverywelcome,althoughtheroadbacktofulloperationalrecoveryislikelytobea
longanddifficultone.Giventheeverpresentscopefordemandandsupplysidesurprises,sotoocould
betheroutetoamorecomfortablemarketbalance.

13S EPTEMBER 2011

D EMAND

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

DEMAND

Summary
Forecast global oil demand is revised down by 200kb/d for 2011 and by 400kb/d for 2012, with
lower than expected 3Q11 readings in the nonOECD and a downward adjustment to global GDP
growth assumptions. Strongerthanexpected OECD monthly submissions and preliminary
datalargelyintheUSprovidesomeoffsettingsupport,asdopowergenerationneedsinJapan,the
MiddleEastandananticipatedrecoveryinLibyanconsumption.Globaloildemandisexpectedtorise
to89.3mb/din2011(+1.2%or+1.0mb/dyoy)andreach90.7mb/d(+1.6%or+1.4mb/d)in2012.

Global Oil Demand (2010-2012)

(millio n barrels per day)

Africa
Americas
Asia/Pacific
Europe
FSU
Middle East
World
Annual Chg (%)
Annual Chg (mb/d)
Changes from last OMR (mb/d)

1Q10 2Q10 3Q10 4Q10 2010

3.3
3.4
3.4
3.4
3.4
29.5 30.0 30.5 30.2 30.1
27.2 26.9 26.7 28.3 27.3
15.0 14.9 15.6 15.5 15.3
4.4
4.3
4.6
4.6
4.5
7.4
7.8
8.3
7.7
7.8
86.8 87.4 89.0 89.7 88.2
2.6
3.2
3.4
3.4
3.2
2.2
2.7
2.9
3.0
2.7
-0.02 -0.02 -0.06 -0.06 -0.04

1Q11 2Q11 3Q11 4Q11 2011

3.4
3.3
3.3
3.4
3.4
30.0 29.8 30.3 30.0 30.0
28.6 27.5 27.7 29.0 28.2
14.9 14.8 15.2 15.2 15.0
4.5
4.6
4.8
4.7
4.6
7.6
8.0
8.5
7.8
8.0
89.0 88.1 89.8 90.2 89.3
2.5
0.7
0.9
0.6
1.2
2.2
0.6
0.8
0.5
1.0
-0.11 0.03 -0.26 -0.49 -0.21

1Q12 2Q12 3Q12 4Q12 2012

3.5
3.6
3.5
3.6
3.5
30.0 29.8 30.4 30.2 30.1
29.6 28.7 28.4 29.6 29.1
14.8 14.6 15.2 15.2 15.0
4.6
4.6
4.9
4.8
4.7
7.9
8.3
8.8
8.1
8.3
90.4 89.6 91.2 91.5 90.7
1.6
1.8
1.6
1.4
1.6
1.4
1.6
1.4
1.3
1.4
-0.39 -0.29 -0.37 -0.53 -0.40

Projected OECD demand for 2011 is now 45.8mb/d (0.8% or 370kb/d) for 2011 and 45.6mb/d
(0.5% or 240kb/d) for 2012. We have cut GDP growth assumptions for both 2011 and 2012,
particularlyinNorthAmericaandEurope.In2011,strongerthanexpectedoildataforNorthAmerica
and the Pacific roughly balance weaker European readings and the GDP changes, resulting in a net
revision of only 20kb/d. In 2012, OECD demand is revised down by 220kb/d. While economic
slowingprovidesdownsiderisks,oilfiredpowergenerationinJapanlendsupsidepotential.

Estimated nonOECD oil demand for 2011 and 2012 is revised down on average by 180kb/d to
43.5mb/d (+3.3% or +1.4mb/d) and 45.1mb/d (+3.8% or +1.7mb/d), respectively. We have
downgraded GDP growth moderately, largely due to China. Lower than expected June/July oil
readings in Asia and Latin America combined with the GDP adjustment drive the demand revisions.
TheMiddleEastandareassessmentofLibyandemandprovidedemandupside,however.

Aneconomicsensitivityanalysis,withGDPgrowthonethirdlowerthaninouradjustedbasecase,
would cut 0.3mb/d from expected 2011 oil demand and 1.3mb/d from the 2012 projection,
effectivelycurbingglobalannualdemandgrowthto0.7mb/dand0.4mb/d,respectively.

Global Overview
Amid recent negative economic developments, this report has lowered global real GDP growth
assumptions for 2011 and 2012 to 3.9% and 4.2%, respectively, down from 4.2% and 4.4% previously.
ThedowngradeislargerontheOECDside,thoughweakerprospectsinChinahavereducednonOECD
growthaswell.Theseadjustmentsdo notreflectanupdateto theIMFoutlook;rathertheyrepresent
preemptive and preliminary moves to better align our assumptions with consensus views. Still, the
SeptemberreleaseofupdatedIMFforecastswilllikelypromptfurtheradjustmentinnextmonthsissue.
Fornow,our2012priceassumption,basedonthefuturesstrip,remainsunchanged,withnominalBrent
at$108/bbl.Wehavereviseddown2011and2012oildemandby200kb/dand400kb/d,respectively,
largely as a result of the GDP changes and lower than expected July preliminary demand readings. A
40kb/d adjustment has also been made to 2010 baseline demand, stemming from JODI database
revisionstoChineseTaipeiandThailand.

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

D EMAND

Real GDP Growth

Overall,globaloildemandcontinuestoexpandatonly
OMR dated 13 September 2011
atepidpace.InJuly,theannualincreaseisassessedat
% change
2011
2012
1.1%, though this is higher than the 0.5% growth WORLD
3.9
4.2
(revised up from zero in last months report) in June. OECD
1.7
2.1
OECD, North America
1.9
2.2
Ourexpectationisforglobaldemandgrowthtoaverage
OECD,
Europe
2.0
1.7
less than 1% for the remainder of the year, with 2011
OECD, Pacific
0.6
3.1
as a whole increasing by 1.2%, or 1.0mb/d. In 2012, Non-OECD
6.4
6.5
demandisexpectedtoriseby1.6%,or1.4mb/d.Both
Africa
3.9
4.8
Latin America
4.6
4.3
of these rates correspond to historical oil demand
China (excl. Hong Kong)
9.5
9.1
income relationships, with sustained high prices
Other Asia
6.3
6.6
keepinggrowthbelowtrendlevels.
Non-OECD Europe
1.9
3.4

FSU
4.8
4.7
Paradoxically, recent data have shown oil demand
Middle East
5.1
5.2
marginallyhigherthanpreliminaryestimates,rebuffing
Current vs. Previous
for now some of the more extreme market prognoses
OMR dated 10 August 2011
thatfurtherfuturedemanddowngradesareinevitable. WORLD
(0.3)
(0.2)
In the US, oil demand based on government OECD
(0.6)
(0.4)
OECD, North America
(0.8)
(0.6)
submissionsandpreliminarydata,albeitdecliningonan
OECD, Europe
(0.4)
(0.3)
annualbasis,hasbeenrevisedupforthesummer,with
OECD, Pacific
(0.3)
(0.2)
stronger than expected diesel performance. Japanese Non-OECD
(0.1)
(0.1)
oil demand appears to be recovering from Marchs
Africa
0.1
0.0
Latin America
0.1
0.2
earthquake and tsunami with oil burning in power
China (excl. Hong Kong)
(0.1)
(0.4)
generation there lending upside risk. Widespread
Other Asia
(0.2)
0.1
poweroutageshavenotemergedinChina,butJulyoil
Non-OECD Europe
(0.4)
(0.3)
demandgrowthwasnotablyhigherthananaemicJune
FSU
(0.2)
0.0
Middle East
0.0
0.0
readings.Withcoffersflushedwithoilexportrevenues,
theenergyintensiveMiddleEastalsoremainsastrong Sources: Consensus Economics, Bloomberg, IMF, IEA
source of demand support. Moreover, this report now
assumesagradualrecoveryofLibyanoildemand,whichhadfallentominimallevels,basedonarecent
easingoftheconflictthere(seeAsFightingSubsides,LibyanOilDemandSettoRebound).

Nevertheless, significant economic threats remain, which skew the overall demand side risk to the
downside. Consumer confidence has plummeted in OECD countries, with manufacturing indicators
easingglobally.Highunemployment,anoverhangofsovereigndebtanduncertainfiscalandmonetary
pictures remain persistent features. As such, we continue to run a sensitivity analysis that shows an
indicativeviewofoildemandshouldGDPgrowthcomeinaroundonethirdlowerthanournowadjusted
basecase.Undersuchconditions,globaloildemandwouldbereducedby0.3mb/dversusourbasecase
for2011andby1.3mb/dfor2012,withannualgrowthat0.7mb/dand0.4mb/d,respectively.

Real GDP vs. Oil Dem and Grow th

1981-2012
2004 2010

World: Total Oil Product Demand

4
3
2
1
0
-1
-2
-3
-4

Annual Oil Demand

Growth, %

Y-o-Y
% Chg
6
4
2
(2)
(4)
(6)
Jan

Apr
2008

13S EPTEMBER 2011

Jul
2009

Oct
2010

Jan
2011

1991

2009
1982

1983/2008
1981

-2

200

2012

2011

0
2
4
Global Real GDP Grow th, %

D EMAND

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Global Oil Demand Growth 2010/2011/2012

thousand barrels per day

North America

Europe

465

293

FSU
169

-79

71

-109

1401 Asia

-234

Middle East
290

-138
-191

226

272

915

868

Latin America
302
173

239

58

184

Africa

Global Demand Growth

(mb/d)

-22

2010
2011
2012

2.70
1.04
1.42

3.2%
1.2%
1.6%

OECD
Accordingtopreliminarydata,OECDinlanddeliveries(oilproductssuppliedbyrefineries,pipelinesand
terminals) contracted by 1.3% yearonyear in July, with declines in OECD North America and OECD
EuropeoutweighinggrowthintheOECDPacific.Allprincipalproductsposteddeclinesexceptfordiesel,
whichroseby1.4%yearonyear.

OECD Demand based on Adjusted Preliminary Submissions - July 2011

(millio n barrels per day)

Gasoline
Jet/Kerosene
Diesel
Other Gasoil
RFO
mb/d % pa mb/d % pa mb/d % pa mb/d % pa mb/d % pa
OECD North Am erica* 10.52
US50
8.95
Canada
0.76
Mexico
0.75
OECD Europe
2.22
Germany
0.45
United Kingdom
0.33
France
0.20
Italy
0.24
Spain
0.13
OECD Pacific
1.61
Japan
1.03
Korea
0.21
Australia
0.32
OECD Total
14.35
* Including US territo ries

-3.5
-3.8
-0.5
-3.6
-7.3
-7.4
-5.5
-7.5
-12.1
-8.5
-2.3
-4.3
9.3
-0.2
-4.0

1.76
1.55
0.12
0.06
1.38
0.19
0.31
0.17
0.12
0.14
0.58
0.30
0.13
0.12
3.71

1.5
2.4
-4.5
-7.6
-0.7
-6.5
-3.1
-0.2
4.7
9.8
-6.0
-11.8
-1.5
3.4
-0.5

4.01
3.44
0.22
0.31
4.42
0.65
0.45
0.70
0.52
0.49
1.10
0.40
0.30
0.35
9.53

6.6
6.9
2.7
6.5
-3.2
-8.2
0.1
-4.0
-5.7
-3.9
3.2
-2.2
9.2
6.4
1.4

0.67
0.22
0.29
0.13
1.42
0.38
0.14
0.23
0.09
0.14
0.50
0.40
0.10
0.00
2.59

-12.2
-33.3
3.1
6.5
-6.3
3.6
-4.1
-0.6
-19.9
-15.7
1.0
5.9
-13.6
0.0
-6.6

0.87
0.48
0.08
0.23
1.25
0.15
0.07
0.07
0.12
0.22
0.72
0.44
0.24
0.02
2.83

-11.2
-19.8
0.5
3.4
-2.4
-7.1
7.4
-14.9
-14.8
8.4
-4.9
3.5
-18.5
-0.1
-5.9

Other
Total Products
mb/d
% pa
mb/d % pa
5.70
4.36
0.71
0.58
3.67
0.60
0.27
0.43
0.42
0.30
3.17
1.79
1.20
0.16
12.54

0.06
0.0
0.4
0.4
-3.1
-8.7
-5.2
0.0
-8.5
-6.0
12.0
14.4
11.1
0.9
1.8

23.53
19.00
2.19
2.06
14.34
2.43
1.58
1.80
1.50
1.43
7.67
4.36
2.19
0.98
45.55

-1.3
-1.7
0.4
0.2
-3.9
-6.3
-2.7
-3.1
-8.6
-3.2
3.6
4.0
4.4
2.8
-1.3

Revisions to June preliminary data were significant, at +500kb/d, with North America (+390kb/d) and
the Pacific (+70kb/d) accounting for most of the adjustment. In both regions, positive revisions were
concentrated in diesel, jet fuel/kerosene and other products. In OECD Europe, revisions to German
naphtha demand from January through June provided some downward offset. Overall, the revisions
boosted the trend in total OECD demand from 2.2% yearonyear to 1.1%. Most product categories
postedannualdeclines,savefordiesel(+2.9%),LPG(+0.6%)andotherproducts(+0.3%).

WiththeincorporationoflowerGDPassumptions,theprognosisfor2011hasbeencutmoderately,by
20kb/d to 45.8mb/d (0.8% or 370kb/d versus the previous year). This minor revision stems from
strongerthananticipatedofficialsubmissionsforJuneandhigherpreliminarydataforJulyandAugust,
whichpartlyoffsettheimpactoflowerGDPondemandfromSeptembertoDecember.Bycontrast,the

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

D EMAND

economicallydowngraded2012outlookhasbeenloweredby220kb/dto45.6mb/d(0.5%or240kb/d
yearonyear).
m b/d
52

OECD: Demand by Driver, Y-o-Y Chg

OECD: Total Oil Product Demand

Transport
Pow er Gen.
Total Dem .

m b/d
1.0
0.5

49

Heating
Other

(0.5)

46

(1.0)
(1.5)

43
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

(2.0)
(2.5)

Jan

2008

2009

2010

2011

2012

North America
Preliminary data show oil product demand in North America (including US territories) falling by 1.3%
yearonyearinJuly,followinga1.0%declineinJune.Economicprospectshaveturnedgloomy,withGDP
growth revised down by 0.8% in 2011 and by 0.6% in 2012, the largest change of any region.
Paradoxically,theprognosisfor2011demandisrevisedupmoderatelyby30kb/dto23.6mb/d(0.8%
or 190kb/d), with upward revisions from submitted and preliminary data (particularly in diesel)
offsettingdownwardadjustmentsfromtheGDPchanges.For2012,however,demandhasbeenrevised
downby120kb/dto23.4mb/d(0.6%or140kb/d).

OECD North America: Demand by

Driver, Y-o-Y Chg

OECD North America:

Total Oil Product Demand

m b/d
27

Transport
Pow er Gen.
Total Dem .

m b/d
26

0.5

25

Heating
Other

24
(0.5)

23

(1.0)

22
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

(1.5)

2008

2009

2010

2011

2012

Junerevisionswerestrong(+390kb/d)andstemmedlargelyfromtheUS(+360kb/d).Diesel(+220kb/d)
led the upgrades, followed by other products (+210kb/d) and jet fuel/kerosene (+90kb/d). These
outweighed downward adjustments to motor gasoline (120kb/d) and residual fuel oil (90kb/d).
WeeklytomonthlyrevisionsfortheUScontinuetobevolatile.Duringthefirsthalfof2011,preliminary
data alternated between positive and negative revisions, with gasoil other products and LPG
particularly vulnerable. By contrast, gasoline revisions, which averaged 280kb/d, were
consistentlynegative.

Adjusted preliminary weekly data for the United States (excluding territories) indicate that inland
deliveriesaproxyofoilproductdemanddeclinedby0.7%yearonyearinAugust,followinga1.7%
fallinJuly.Gasolinedemandhasremainedweakthroughthesummerdrivingseason,decliningby3.8%
and 3.0% in July and August, respectively, with a less pronounced seasonal upswing compared to
historicalnorms.Amidgasolineprices25%higherinJuneversustheprioryear,andaslowingeconomy,
consumers continued to cut vehicle miles travelled that month, with readings showing a yearonyear
declineof1.4%.Dieseldemand,however,continuedtoexpandrobustly,withAugustgrowthestimated

13S EPTEMBER 2011

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at7.2%,evenamidevidenceofslowingmanufacturingactivity.USGDPisnowassumedtogrowby1.6%
in2011and2.0%in2012,versus2.5%and2.7%previously.Nevertheless,duetostrongerthanexpected
preliminarydata,2011demandisrevisedupby30kb/dto19.0mb/d(0.9%or170kb/dyearonyear).
Bycontrast,2012demandisreviseddownby100kb/dto18.9mb/d(0.6%or110kb/d).

kb/d
4,700

US50: Gasoil Demand

2008$/
gallon
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0

4,500
4,300
4,100
3,900
3,700
3,500
3,300
Jan
Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

7.0

US50: Gasoline Price vs. Vehicle

Miles Traveled , Seasonally Adj
June 11
2000-2006
2007-2008
2009-2011

7.3

7.5
7.8
8.0
VMT(bn/day)

8.3

8.5

InMexico,oildemandremainedrelativelyflatinJuly(+0.2%yearonyear),withpersistentweaknessin
jet/kerosene(7.6%)andgasoline(3.6%).Dieseldemandcontinuedtogrowstrongly,however,risingby
6.5% in July. Jet fuel/kerosene demand has steadily recovered since last summers bankruptcy of
Mexicanaairlines.Still,consumptioninJulywassharplybelowyearagolevels,down7.6%.

Europe
Preliminary inland data indicate that oil product demand growth in Europe declined by 3.9% yearon
yearinJuly,withallproductcategoriesfallingexceptforLPG(+3.7%).Declineswereparticularlyheavyin
gasoline(7.3%)andnaphtha(10.5%)onthebackofweakdeliveriesofheatingoilandfallinggasoline.
Heating oil tank filling appears to have started rising seasonally, though demand still remains weak
(6.3%)comparedto2010duetohigherprices.

m b/d
16.5

OECD Europe: Demand by Driver,

Y-o-Y Chg

OECD Europe:
Total Oil Product Demand

15.5
15.0

14.5

(0.2)

14.0

(0.4)

13.5

Heating
Other

(0.6)
Jan
Apr
Jul
Range 2006-2010
2010

Transport
Pow er Gen.
Total Dem .

m b/d
0.2

16.0

Oct
5-year avg
2011

Jan

(0.8)

2008

2009

2010

2011

2012

Revisions to preliminary June demand data were positive, at +40kb/d, with higher readings for most
products outweighing downward revisions to naphtha (130kb/d), largely in Germany, and gasoline
(30kb/d). With lower expected GDP growth, our OECD Europe forecast is revised down by 90kb/d in
2011andby110kb/din2012.Demandisnowexpectedtodeclineby240kb/d(1.7%)to14.3mb/din
2011andby100kb/d(0.7%)in2012to14.2mb/d.

InJuly,accordingtopreliminarydata,oilproductdeliveriesinGermanypostedadeclineof6.3%year
onyear. The incorporation of baseline revisions from January to June lowered naphtha demand on
average by 50kb/d during that period, with downward adjustments partially carried through to
preliminaryandforecastedvalues.AllcategoriesdeclinedinJulyexceptheatingoil(+3.6%),suggesting
thatconsumershavebeguntheirseasonaltankrefilling.

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I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

kb/d
800

D EMAND

kb/d
280

Germany: Heating Oil Demand

700

260

600

240

500

220

400

200

300

180

200

160

100

France: Motor Gasoline Demand

140
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

Demandfellby3.1%inFranceinJuly,withdeclinesinallproducts,exceptfornaphthaandtheother
products category. Gasoline demand (7.5%) was weak, partially due to unfavourable holiday weather
conditions. Spain (3.2%) and Italy (8.6%) also posted total product declines. In June, government
submissionsshoweddemandrisinginbothTurkey(+10.3%)andtheUK(+5.7%).Theformerwasmarked
byastrongmonthlyincreaseindiesel,whilejetfuel/kerosenedemandrosesharplyinthelatter.

Pacific
Preliminary data indicate that oil demand in the Pacific grew by 3.6% yearonyear in July with all
categories rising except for gasoline, jet fuel/kerosene and residual fuel oil. The regional economic
picturehasbeentrimmedfor2011and2012,thoughoildemandappearstoberecoveringfromJapans
devastatingearthquakeandtsunamiinMarch.RevisionstoJunepreliminarydata,at+70kb/d,wereled
by heating oil, diesel and jet fuel/kerosene. Despite evidence of economic weakness and high prices
weighinguponregionaldemand,ourassessmentisrevisedupby30kb/dto7.9mb/d(+0.9%or70kb/d)
for2011andislargelyunchangedat7.9mb/dfor2012(+0.0%).

m b/d
10.0
9.5
9.0
8.5
8.0
7.5
7.0
6.5

OECD Pacific: Demand by Driver,

Y-o-Y Chg

OECD Pacific:
Total Oil Product Demand

Transport
Pow er Gen.
Total Dem .

m b/d
0.2
0.1

Heating
Other

(0.1)
(0.2)

Jan
Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

(0.3)
(0.4)
2008

2009

2010

2011

2012

In Japan, oil demand rose by 4.0% yearonyear in July. LPG (+11.3%), heating oil (+5.9%) and other
products(+30.2%),whichincludedirectcrudeburn,postedthestrongestgains.Japansdemandgrowth
partiallystemsfromincreasedoilusageinthepowersectordespitecoolertemperatures,mainutilities
reported35kb/dhigherconsumptionthaninJuly2010(3Q10wasmarkedbyhotweatherandstrongoil
usagetomeetpeakpowerdemand).Inaddition,strongervaluesacrossotherproductcategoriessuggest
aspeedierrecoveryfromMarchsearthquakeandtsunami.Nevertheless,westillassumerisingoilfired
generation needs ahead with the uncertain state of Japans nuclear power. Though the overall profile
has not changed since last months report, assumptions have been tweaked to allow for slightly more
crudeoilversusfueloilgrowthbasedonrecentdata.Overall,Japanesetotaloildemandisrevisedupby
20kb/din2011andremainslargelyunchangedfor2012.Demandin2011isexpectedtogrow60kb/d
(+1.4%)to4.5mb/d,while2012demandshouldgrowmarginally(+0.1%),remainingnear4.5mb/d.

13S EPTEMBER 2011

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kb/d
750

Japan: Other Products Demand

Japan : Oil Consumption (Crude +

Fuel Oil) for Power Generation*

kb/d
800

*Main Utilities; Source: FEPC, IEA

650

600
550

400

450

200

350

250
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

Jan

Mar
2007

May

2010

Jul
2008

Sep

Nov
2009

2011

MeanwhileinKorea,the picturehasstrengthened withoildemandgrowing by4.4%inJuly,versusan

average6.2%declineduringthepriorthreemonths.GainswerestronginLPG(+16.6%),diesel(+9.2%),
gasoline(+9.3%)andnaphtha(+11.2%).Yet,withtheeconomicoutlookdowngradedthisyearandgiven
therecentvolatilenatureofoildemandgrowth,forecastadjustmentsremainconservative.Theoutlook
isrevisedupby10kb/dinboth2011and2012.However,oildemandisstillexpectedtodecline,by1.4%
and0.4%thisyearandnext,respectively,toaround2.2mb/d.

Non-OECD
PreliminarydemanddataindicatethatnonOECDoildemandgrewby3.8%yearonyear(+1.6mb/d)in
July, up from 2.2% in June. Much of the pickup stemmed from relatively stronger demand growth in
China and India. July demand is estimated at 43.8mb/d, while June levels have been revised down by
90kb/d to 43.9mb/d (+1.0mb/d yearonyear). Growth in most product categories increased in July,
particularly in gasoline (+4.3%), gasoil (+4.6%) and other products (+4.9%). At the regional level, the
largestchangeoccurredinAsia,whereareboundinChinesedemandboostedJulygrowthto4.7%.The
FSU(+7.5%)andtheMiddleEast(+3.4%)alsocontinuedtoshowhealthyexpansions.

m b/d Non-OECD: Total Oil Product Demand

46
44

m b/d
9.0

Non-OECD: Motor Gasoline Demand

8.5

42

8.0

40
7.5

38

7.0

36
34

6.5
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

Non-OECD: Demand by Product

(tho usand barrels per day)
D e m a nd

A nnua l C hg ( k b/ d)

A nnua l C hg ( %)

May-11

Jun-11

Jul-11

Jun-11

Jul-11

Jun-11

LPG & Ethane

4,926

5,034

4,938

277

234

5.8

5.0

Naphtha

2,674

2,635

2,640

-39

-10

-1.4

-0.4

Motor Gasoline

8,378

8,419

8,520

188

350

2.3

4.3

Jet Fuel & Kerosene

2,637

2,658

2,712

40

1.5

0.3

13,587

13,786

13,564

594

592

4.5

4.6

Residual Fuel Oil

5,388

5,478

5,530

-72

145

-1.3

2.7

Other Products

5,977

5,912

5,924

-27

276

-0.5

43,566

43,923

43,827

962

1,595

2.2

Gas/Diesel Oil

Total Products

10

Jul-11

4.9
3.8

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

D EMAND

Non-OECD: Demand by Region

(tho usand barrels per day)
D e m a nd

A nnua l C hg ( k b/ d)

A nnua l C hg ( %)

May-11

Jun-11

Jul-11

Jun-11

Jul-11

Jun-11

Jul-11

3,273

3,355

3,322

-188

-59

-5.3

-1.7

Asia

20,423

20,204

19,883

309

893

1.6

4.7

FSU

4,631

4,925

4,777

425

333

9.4

7.5

Latin America

6,418

6,488

6,610

135

138

2.1

2.1

Middle East

8,125

8,242

8,564

232

281

2.9

3.4

697

708

671

48

7.2

1.4

43,566

43,923

43,827

962

1,595

2.2

3.8

Africa

Non-OECD Europe
Total Products

AnupdatedGDPprofilehascutnonOECDeconomicgrowthby0.1%forboth2011and2012,largelydue
to a weaker China outlook. As such, demand has been revised down by 180kb/d for 2011 and by
170kb/d for 2012. NonOECD annual growth is now assessed at +3.3% (+1.4mb/d) for 2011, with
demandreaching43.5mb/d,andat+3.8%(+1.7mb/d)for2012,asdemandclimbsto45.1mb/d.

China
Chinasmonthlyapparentdemand(calculatedasrefineryoutputplusnetproductimports)roseby6.1%
yearonyearinJulyasrefineryrunsrebounded.ApparentdemandinJunewasrevisedupby140kb/d,
though growth for that month, at 0.1%, remained marginal. July demand was led by yearonyear
increasesingasoil(+7.9%),residualfueloil(+10.6%)andgasoline(+5.0%).Despitetheincreaseingasoil,
demand has not surged, suggesting little of an earlier anticipated widespread rampup of diesel
generators in the face of summer power constraints. Electricity shortages remain a risk with some
market sources pointing to potential outages through the autumn and winter given weak hydropower
suppliesinsomeareasandhighcoalprices.Still,ourforecastdoesnotenvisageasimilar300kb/drisein
gasoildemandin4Q11asexperiencedintheprioryearamidcoalfiredpowerrestrictions.

China: Demand by Product

(tho usand barrels per day)
D e m a nd

A nnua l C hg ( k b/ d)

A nnua l C hg ( %)

2010

2011

2012

2011

2012

2011

668

694

713

27

19

4.0

2.7

Naphtha

1,129

1,197

1,254

68

57

6.0

4.7

Motor Gasoline

1,546

1,648

1,730

102

82

6.6

5.0

368

389

410

21

21

5.6

5.4

3,142

3,355

3,511

212

156

6.8

4.7

LPG & Ethane

Jet Fuel & Kerosene

Gas/Diesel Oil
Residual Fuel Oil

2012

531

525

531

-6

-1.2

1.1

Other Products

1,685

1,788

1,935

103

147

6.1

8.2

Total Products

9,069

9,596

10,083

527

487

5.8

5.1

kb/d
3,600

China's GDP, Oil Demand & Implied

Y-o-Y
Income Elasticity

China: Gasoil Demand

2.0

20%

1.5

15%

2,800

1.0

10%

2,600

0.5

5%

3,400
3,200
3,000

2,400
-

2,200
Jan
Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

0%
2001 2003 2005 2007 2009 2011

Jan

Implied Elasticity
GDP Growth

Demand Growth

In part, the power sector picture looks more secure due to moderating economic activity. The
manufacturingpurchasingmanagersindex,at50.9inAugust,indicatesonlymoderateexpansionwhile

13S EPTEMBER 2011

11

D EMAND

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

stillhighinflationhasconstrainedmonetarypolicy.OurassumptionsforChineseGDPgrowthhavebeen
trimmedto9.5%and9.1%for2011and2012,respectively,downfrom9.6%forbothyears.Tobesure,
views over Chinese growth remain divided, with differing opinions over the degree of the economys
soft landing and some forecasters seeing growth in 2012 at less than 8.5%. Our forecast has revised
down Chinese demand by 20kb/d in 2011 and by 50kb/d in 2012, with growth now seen at a still
substantial5.8%and5.1%,respectively.

Other Non-OECD
InIndia,oildemandroseby4.3%yearonyearinJuly,notablyhigherthanthe1.0%increaseregistered
inJune.Growthacceleratedingasoline(+4.5%),gasoil(+4.3%)andotherproducts(+16.0%).Similarto
manycountries,Indiasmanufacturingsectorhasslowedinrecentmonths,withpurchasingmanagers
activity falling in August. Yet, expansion remains more robust than in China and OECD countries.
Moreover,thoughIndiaspassengercarsales,whichroseby18%yearonyearin1H11,haveslowed,the
market is among the worlds fastest growing. Our outlook for demand has changed little, with 2011
nudgedhigherby10kb/dand2012unchanged.Growthisnowseenat3.4%thisyearandat4.2%next
year,thoughfurthereconomicslowingremainsadownsiderisk.

India: Demand by Product

(tho usand barrels per day)
A nnua l C hg ( k b/ d)

D e m a nd

A nnua l C hg ( %)

2010

2011

2012

2011

2012

2011

LPG & Ethane

455

491

521

35

30

7.8

6.2

Naphtha

201

200

191

-1

-9

-0.7

-4.5

Motor Gasoline

338

359

384

22

25

6.4

6.9

Jet Fuel & Kerosene

299

303

308

1.3

1.5

1,290

1,352

1,436

61

84

4.8

6.2

Residual Fuel Oil

194

181

188

-13

-6.7

3.6

Other Products

558

564

566

0.9

0.4

3,336

3,449

3,593

113

143

3.4

4.2

Gas/Diesel Oil

Total Products

2012

kb/d
400

kb/d
270

India: Motor Gasoline Demand

Iraq: Gasoil Demand

250

350

230
300

210

250

190
170

200
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

150
Jan
2008

Apr

Jul
2009

Oct
2010

Jan
2011

Middle East demand continues to grow strongly, up by an estimated 3.4% in July. Iraqi consumption
reachedapostwarhigh(800kb/d)inJune,growingby5.2%yearonyear.Gasoil(+21.8%)andgasoline
(+12.2%) were particularly robust with rising diesel generator usage to meet cooling needs and
increasingvehicletravel.Kuwaitidemand(+33.2%)seeminglysurgedinJuly,followinggrowthof27.9%
inJune,withsharplyrisinggasoilandresidualfueloil.SaudiArabiagrewbyonly2.6%yearonyear,even
asoilfiredgenerationneedsroseseasonally.RecentmonthsJODIdataforbothKuwaitandSaudiArabia
hasbeenvolatile,however.Assuch,ouradjustedgrowthratesmayonlyserveastentativeindicators.In
contrast to the regional picture, Iranian consumption continued to decline, falling by 2.5% in July on
weak deliveries of gasoline and jet fuel/kerosene, which are supply constrained by international
sanctions,amidnowhigherdomesticpetrolpricesversusayearago.

12

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

D EMAND

As Fighting Subsides, Libyan Oil Demand Set to Rebound

In Libya, recent events have pushed the country closer to resolution of the conflict that has raged since
February. Though the situation on the ground remains fluid, oil demand has likely started a gradual
recovery.BasedonJODIsubmissions(whichmayonlybe
kb/d
Libya: Total Oil Product Demand
an approximate measure, given events on the ground),
350
we estimate that Libyan demand fell to minimal levels
(just over 100kb/d) from MarchJuly. Refinery 300
shutdowns, disrupted port operations, damaged 250
infrastructure and reduced economic activity pushed 200
demand down from an average 260kb/d in 2010.
150
Localised product shortages and weak economic activity
arelikelytocontinueweighingondemandthrough2012. 100
50
Nevertheless,acombinationofincreasedrefineryoutput
Jan
Apr
Jul
Oct
Jan
and reestablished fuel imports should ease supply
Range 2006-2010
5-year avg
constraints going forward. Smuggling from neighbouring
2010
2011
countries will likely also play a role, though its impact is
hardertomeasure.Assuch,weseeconsumptionrecoveringto200kb/dbytheendof2011andaveraging
225kb/d in 2012 (+45% or +70kb/d yearonyear) with potential upside should reconstruction proceed
fasterthananticipated.

kb/d
550

Iran: Motor Gasoline Demand

kb/d

Brazil: Motor Gasoline Demand

1,000

500

800

450

600

400

400

350

200

300

250
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-year avg
2011

Jan

Ethanol (Hydrous & Anhydrous)

Gasoline

InBrazil,productdemandexpandedby1.3%yearonyearinJune,ledbyjetfuel/kerosene(+10.2%)and
gasoil(+3.9%).Gasolinedemand(+1.1%)increasedmoderatelyamidhighethanolprices.Adisappointing
sugarcaneharvestandtightethanolsupplies,evenwithincreasedimportsfromtheUS,haveprompted
the government to cut required anhydrous alcohol blending in gasoline from 25% to 20% from
1October. At the same time, Petrobras is increasing gasoline imports to support rising interfuel
substitution, and naphtha imports, to allow for greater refinery gasoline production. The Brazilian
economy has shown evidence of slowing. Indeed, with a weaker than expected June, our total oil
demand forecast is revised down by 20kb/d for 2011, but left largely unchanged for 2012. With still
robustdemandgrowthinthefaceofunderinvestmentintheethanolsectoranddomesticpetrolprice
caps,Brazilsshortgasolinepositionislikelytocontinuethroughthisyearandnext.
Brazil: Demand by Product
(tho usand barrels per day)
D e m a nd

A nnua l C hg ( k b/ d)

A nnua l C hg ( %)

2010

2011

2012

2011

2012

2011

LPG & Ethane

219

222

225

1.6

2012
1.4

Naphtha

166

166

168

0.3

1.4

Motor Gasoline

792

817

852

25

35

3.1

4.3

Jet Fuel & Kerosene

110

121

132

11

10

10.2

8.4

Gas/Diesel Oil

886

917

958

30

41

3.4

4.5

Residual Fuel Oil

187

164

155

-22

-9

-12.0

-5.5

Other Products
Total Products

13S EPTEMBER 2011

374

380

386

1.6

1.7

2,733

2,787

2,876

54

89

2.0

3.2

13

S UPPLY

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

SUPPLY

Summary
Globaloilsupplyroseby1.0mb/dto89.1mb/dinAugustfromJuly,withnonOPECproviding80%
of the total increase. Compared to a year ago, global oil production increased by 1.2mb/d, almost
40% of which stemmed from higher OPEC NGLs production and another third from increased OPEC
crudeoutput.

NonOPEC supply rose by 0.8mb/d to 52.9mb/d in August, with new outages in the Middle East
andChinamitigatedbyincreasingproductioninLatinAmericaandtheconclusionofmaintenancein
AlaskaandKazakhstan.NonOPECsupplyisexpectedtoincreaseduringthesecondhalfoftheyear
ongrowthfromtheUS,LatinAmerica,andtheCaspianregion.SomeshutinsattheConocoPhillips
operated Peng Lai field in China and storm outages in the Gulf of Mexico should dent nonOPEC
productiongrowthinthesecondhalfoftheyear.NonOPECsupplygrowthin2011isnowexpectedto
totalaround0.2mb/d,downfromestimatesof0.4mb/dlastmonth.

OPEC crude oil output in August was up by 165kb/d, to 30.26mb/d. Despite the groups higher
output levels, August production is still 1.04mb/d below the 31.3mb/d call on OPEC crude and
stockchangeestimatedfor3Q11.However,thecallfor4Q11hasbeenrevisedlowerby0.2mb/dto
30.5mb/d,duetoadownwardrevisionfordemandamidaweakerglobalGDPoutlook.

With the end of Libyas civil strife seemingly on the horizon, analysts have been reviewing the
outlookforrestorationofthecountrysproduction.Amyriadofreportsonthetimingandscalefora
resumption of oil production have circulated, but foreign oil company partners, alongside industry
analysts,remaincautious.WehaverevisedupourLibyancapacityoutlookfor4Q11by100kb/d,to
anaverage300kb/d.Capacityreaches350400kb/dbyend2011,risingto1.1mb/dby4Q12.

mb/d

OPEC and Non-OPEC Oil Supply

62

mb/d
31.0

60

30.5

58

30.0

56

29.5

54

29.0

52

28.5

50

28.0

Jan 11

Jul 11

Jan 12

Non-OPEC
OPEC Crude - RS

Jul 12
OPEC NGLs

mb/d
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.5

OPEC and Non-OPEC Oil Supply

Year-on-Year Change

May 10 Aug 10 Nov 10 Feb 11 May 11 Aug 11

OPEC Crude
OPEC NGLs

Non-OPEC
Total Supply

All world oil supply figures for August discussed in this report are IEA estimates. Estimates for OPEC
countries,Alaska,IndonesiaandRussiaaresupportedbypreliminaryAugustsupplydata.

Note: Random events present downside risk to the nonOPEC production forecast contained in this report.
Theseeventscanincludeaccidents,unplannedorunannouncedmaintenance,technicalproblems,labourstrikes,
politicalunrest,guerrillaactivity,warsandweatherrelatedsupplylosses.Specificallowancehasbeenmadein
the forecast for scheduled maintenance in all regions and for typical seasonal supply outages (including
hurricanerelatedstoppages)inNorthAmerica.Inaddition,fromJuly2007,anationallyallocated(butnotfield
specific)reliabilityadjustmenthasalsobeenappliedforthenonOPECforecasttoreflectahistoricaltendency
forunexpectedeventstoreduceactualsupplycomparedwiththeinitialforecast.Ourcurrentassessmenttotals
200kb/dfornonOPECasawhole,withdownwardadjustmentsfocusedintheOECD.

14

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

S UPPLY

OPEC Crude Oil Supply

OPEC crude oil output in August was up by 165kb/d, to 30.26mb/d. Higher output by Saudi Arabia,
Nigeria, Angola, Iraq, Kuwait, and the UAE more than offset a combined cut of 40kb/d by Iran and
Venezuela.ProductionbytheOPEC11withoutputtargets,whichexcludesIraq,increasedby130kb/d
to27.58mb/dinAugust,around2.74mb/dabovethegroupsformal,butnowlargelyirrelevant,output
targetof24.845mb/d.

Despitethegroupshigheroutputlevels,Augustproductionisstill1.04mb/dbelowthe31.3mb/dcall
on OPEC crude and stock change expected for 3Q11. However, the call for 4Q11 has been revised
downby0.2mb/dto30.5mb/d,duetoadownwardrevisionfordemandonthebackofweakerglobal
GDP outlook. As a result, the gap between the call and recent supplies has narrowed to just under
250kb/d. The call for 2012 has been lowered by 200kb/d to 30.6mb/d. OPEC spare capacity is
estimatedat3.24mb/dinAugust,withthecontinuedabsenceofLibyansuppliesonlypartiallyoffsetby
higheroutputfromotherproducers.Augustcrudesupplyisstill0.2mb/dbelowpreLibyancrisislevels.
m b/d
32

m b/d
33

Quarterly Call on OPEC Crude + Stock

Change

OPEC Crude Oil Production

32

31
30

31

29

30

28

29

27

28

26
1Q

2Q

3Q

Jan

4Q

2 0 10
2 0 11
2 0 12
Entire series based o n OP EC Co mpo sitio n as o f January 2009
o nwards (including A ngo la & Ecuado r & excluding Indo nesia)

Mar

2008

2009

Jul

Sep
2 0 10

Nov

Jan
2 0 11

Entire series based o n OP EC Co mpo sitio n as o f January 2009

o nwards (including A ngo la & Ecuado r & excluding Indo nesia)

WiththeendofLibyascivilstrifeseeminglyonthehorizon,analystsarereviewingtheirforecastsforthe
restorationofthecountrysproduction.WehavemadeamodestupwardrevisiontoourLibyancapacity
outlookfor4Q11of100kb/d,toanaverage300kb/dandreaching350400kb/dby end2011,before
risingtoatotalof1.1mb/dby4Q12(seeShortTermOilSupplyProspectsinLibyaasEndgameNears).

Saudi Implied Crude Oil Direct Burn

Saudi Arabias supply was pegged at 9.8mb/d in kb/d
1000
August, up 100kb/d from Julys downwardly revised
800
estimate of 9.7mb/d. Exports appear largely
unchangedfromJulylevels,withtheincreasedvolumes
600
dedicated to meet higher demand for direct crude
400
burn.SaudiArabiasimplieddirectburnwasestimated
atjustover700kb/dforJulyversusaround615kb/din
200
June.Thecountrysneedfordirectcrudeburntypically
0
peaks in August, which last year averaged around
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
910kb/d.
Implied Crude Oil Direct Burn

Fellow Gulf producers Kuwait and the UAE both increased output to 2.53mb/d, up 20kb/d and plus
30kb/d,respectively,inAugust.

Crude oil supplies from Iran were slightly lower monthonmonth, off 20kb/d to 3.51mb/d in August.
Iranianoutputcontinuestobeunderminedbythelackofforeigninvestmentduetostifferinternational
sanctions. The drop in production stems from declining output at southern fields, according to Iranian
officials.AtopofficialatIransstateownedNationalIranianSouthOilCompany(NISCO)reportedthat
the countrys production was declining at an average 300330kb/d a year compared with other

13S EPTEMBER 2011

May

15

S UPPLY

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

estimatesbythegovernmentofaround100kb/d.NISCOproducesaround80%ofthecountrysoutput.
The countrys higherthanreported decline rate partly reflects the lack of new field development and
partlytheseveredelaystothecountrysSouthParsprojects,whichhaveconstrainedtheamountofgas
availableforplannedenhancedoilrecoveryatitsageingfields,theNISCOofficialsaid.

Iraqi supply rose 35kb/ to 2.68mb/d in August, due to higher exports from southern terminals. Total
exportswereupby20kb/d,to2.19mb/d.ShipmentsofBasrahcrudewerereportedlyrunningflatout,
uparound20kb/dto1.73mb/dwhileexportsfromthenorthernportofCeyhanontheMediterranean
werelargelyunchangedat450kb/dinAugust(afurther10kb/dwassentbytrucktoJordan).

Angolan production rose by 20kb/d, to 1.69mb/d as output from the Greater Plutonio field edged
higher.Aftermaintenanceandrepairworkcurtailedoutputto100kb/dinAprilJune,productionisnow
estimated at 170kb/d, but still short of its 200kb/d nameplate capacity due to continued technical
issuesrelatedtothewaterinjectionsystem.

Meanwhile, first oil from the Totaloperated 220kb/d deepwater Pazflor field arrived ahead of its
scheduled4Q11startupon24August.Productionon31Augustwasestimatedataround45kb/d,with
three 950,000 barrel cargoes expected to load in September. However, startup of the PSVM field
operated by BP has been delayed from 4Q11 to March/April 2012 due to problems found with
equipmentduringaninspectionattheconstructionyardsinSingapore.

NigerianAugustcrudeoilproductionrosetothehighestlevelinfiveyears,upby60kb/d,to2.32mb/d.
MajorattacksonoilinfrastructurehaveabatedfollowingthegovernmentsOctober2009ceasefireand
amnestyagreementwithmilitantsin theNigerDelta,enablingIOCstoincreaseproduction.Thatsaid,
acts of sabotage, oil theft and illegal bunkering continued to disrupt oil flows last month. Once again,
ShelldeclaredforcemajeureonsomeBonnyLightloadingsfrom23AugustthroughOctober,following
sabotagetoseveralkeypipelinesbysuspectedoilthieves.On11August,militantsbombedaChevron
operated pipeline that carries Escravos crude to the 20kb/d Dibi flow station in the Warri region. Oil
thievesalsocausedafireatENIsTebidabaBrasspipelineinlateAugust,buttheimpactonoutputwas
reportedlyminimal.
OPEC Crude Production
(million barrels per day)

End-2011
Sustainable
Production
Capacity

Algeria

1.26

1.28

1.28

1.34

0.06

1.34

Angola

1.49

1.67

1.69

1.95

0.26

1.98

Ecuador

0.50

0.49

0.49

0.53

0.04

0.53

Iran

3.65

3.53

3.51

3.72

0.21

3.68

Kuwait

2.49

2.51

2.53

2.54

0.01

2.54

Libya

0.08

0.06

0.00

0.20

0.20

0.30

Nigeria

2.28

2.26

2.32

2.53

0.21

2.55

Qatar

0.82

0.82

0.82

1.04

0.22

1.04

Saudi Arabia

9.80

9.70

9.80

12.04

2.24

12.04

UAE

2.50

2.50

2.53

2.74

0.21

2.74

2.62

2.63

2.61

2.64

0.03

2.59

27.49

27.45

27.58

31.26

3.68

31.33

2.72

2.65

2.68

2.84

0.16

2.88

30.21

30.09

30.26

34.10

3.84

34.21

Venezuela

OPEC-11
Iraq
Total OPEC

(excluding Iraq, Nigeria, Venezuela

1
2
3
4

16

Spare Capacity
vs Aug 2011
Supply

Jul 2011
Supply

Aug 2011
Supply

Sustainable
Production

Jun 2011
Supply

Capacity levels can be reached within 30 days and sustained for 90 days.
Includes half of Neutral Zone production.
Nigeria's current capacity estimate excludes some 200 kb/d of shut-in capacity.
Includes upgraded Orinoco extra-heavy oil assumed at 460 kb/d in August.

Capacity

3.24)

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I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

S UPPLY

Short-Term Oil Supply Prospects in Libya as Endgame Nears

The prospects for partial restoration of Libyan hydrocarbon supplies in the short term have improved
followingthefallofTripolitorebelforceson21August.Amyriadofreportsonthetimingandscalefora
resumptionofoilproductionhavecirculated,butforeignoilcompanypartners,alongsideindustryanalysts,
remain cautious. Damage to production facilities, pipelines, refineries and ports, although believed
comparatively light, will need to be fully assessed, and security on the ground assured before major
increases in production can be expected. The pace of the restoration of production will also hinge on
whetherthefieldswereprofessionallyshutinanddoneinarushed,haphazardmanner.
Fornow,wehavemodestlyrevisedupourexpectations
ofLibyancrudeproductioncapacityto350400kb/dby
end2011, rising to a total of 1.1mb/d by 4Q12. The
projectionispredicatedonanimminentendtothecivil
unrest,andassumingthatpoliticalstabilityandsecurity
onthegroundareachievedintheverynearterm.The
Zawiya and smaller Tobruk refineries may restart
operations relatively quickly once crude supplies are
available,butRasLanuf,thecountryslargest,maytake
several months (See Refining section, Libyan Refinery
Status).Dependingontheprioritisationofdomesticoil
usevsrevenueneeds,crudeexportsmightattain200
250kb/din4Q11,risingto650850kb/dbyend2012.

mb/d
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0

LibyanCrude OilCapacityOutlook

4Q10

2Q11

4Q11

2Q12

4Q12

WithColonelGaddafistillatlargeatthetimeofwriting,andpocketsofloyalistresistancestillputtingupa
fight, securityremains uncertain. Indeed, the twin challenges of creating political stability and security on
thegroundinordertoenableforeignoilcompaniestoreturntothecountryareformidable.Priortothecivil
uprising,Europetookover85%ofLibyascrudeexports,withabout13%headingEastofSuez.In2010,Libya
exported 1.2mb/d of crude oil to IEA countries. An additional 0.1mb/d of crude oil from Libya went to
Chinain2010,accountingforsome3%ofthetotalChinesecrudeimports.

Upstream Oil Restoration

As the endgame in the countrys uprising gathers momentum, international organisations have moved
swiftly to lift sanctions and remove other impediments to restoring civil society as the new National
TransitionalCouncil(NTC)takesoverthereinsofgovernment.TheinternationalgroupingcalledtheFriends
ofLibyametinParison1Septembertooffersupport,includingurgingcountriestounfreezefundsheldby
theformerregime,whiletheEUliftedsanctionsonLibyanoverseasassets,portsandoilcompanies.
Therehavebeenwidelydisparatereportsonthestateofthecountrysoilandgassector.TheNTCandstate
Arabian Gulf Oil Co (AGOCO) have both publicly announced a very ambitious timeline for restarting oil
production,whichmostexternalanalystsbelievewillnotbemet.AGOCOsaidproductioncouldrestartby
midSeptemberandreach500600kb/dwithintwotothreemonthsandfullproductionof1.6mb/dwithin
a year. However, the countrys interim oil minister, Ali Tarhouni, said production initially would be in the
tens of thousands barrels a day rather than hundreds but ultimately reach predisruption levels within a
year. Industry experts and IOCs previously operating in the country estimate it could take anywhere
betweenonetothreeyearstogetproductionfullyrestored.Severalissueshighlightupsideanddownside
riskstotheoiloutlook.Causeforoptimismstemsfrom:
TheliftingofEUsanctionson1September,liberatinganestimated$15billionoffrozenLibyanassetsto
helpmeetshorttermneeds;
NTC statements that an armed force has been dispatched to protect the eastern fields, accounting for
80% of Libyan output, and that technical teams will be sent to the Sarir and Mesla fields in the Libyan
deserttoinvestigatedamageinthefirstweekofSeptemberfollowingRamadan;
Animperativetorestartcrudeproductionassoonaspossiblefortheassociatedgasneededtorunthe
countryspowergenerationfacilities;
News that the 510kilometre GreenStream BV undersea gas pipeline system between Mellitah (near
Tripoli)andGelainItaly,hasbeenrepaired,withexportsexpectedtoresumebymidOctober.

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S UPPLY

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Short-Term Oil Supply Prospects in Libya as Endgame Nears

(continued)

Ontheotherhand,technical,securityrelatedandinstitutionalbarriersremaintorapidandfullrestoration:
OngoingresistancefromGaddafiloyalists,withtherisktheyimplementascorchedearthpolicy.Thereare
crediblereportsthatloyalistforceshavealsoheavilyminedsomestrategicoilfacilities.
Divisions within the new leadership along tribal and regional lines may stall progress in creating a
sustainablegovernmentnecessaryforrenewedinvestment.ThereisevidentlyfrictionbetweentheNTC
and various rebel groups from Misrata and the western mountain region, and many analysts fear that
Islamistgroupswillposethelargestobstacletocreatingaunitygovernment.
Securingequipmentandworkerstoassessdamageandmanagerepairworkcouldtakemuchlongerthan
assumed, given security issues. The operating status of almost all of Libyas oil infrastructure remains
unclear,notablythecountryslargestoilterminal,the450kb/dEsSiderfacility.
Given these many uncertainties, we persist with a deliberately cautious set of assumptions for available
crude oil production capacity through the end of the year. In the MediumTerm Oil and Gas Markets
(MTOGM)projectioninJune2011,weassumedhostilitiescontinuedthroughend2011,withsomeformof
resolution in early 2012. What now looks like an earlierthanexpected end to fullscale hostilities has
promptedourmodestupwardrevisions.Fromzerooutputcurrently(andhencebelowthe200kb/dbaseline
deployed in MTOGM), production is now assumed to ramp up to an average 300kb/d in 4Q11, reaching
350400kb/d by the end of 2011. Production is also now seen reaching around 1.1mb/d by 4Q12, with
manylocalandinternationalexpertsenvisagingatwotothreeyeartimeframebeforethecountryregains
2010levelsofaround1.6mb/d.
(to Italy)

Bouri

Farwah FPSO
Zuwarah
Al-Jurf
Tripoli
TUNISIA
Homs
Mellitah Zawia
Oued
Misratah
Chebbi
Tigi
Kabir

Mediterranean Sea
Marsa el-Hariga
Benghazi

Bir Tlacsin
Sirte

Gulf of
Sirte
Es-Sider
Ras Lanuf

Tobruk

Antelat
Zueitina
Marsa el-Brega

ALGERIA

Gazeil

Dahra E/Daha W
Al-Hamra fields

Wafa

Beda
Sabah

Oued Tahara
LIBYA

Amal/As-Sarah
Augila/Nafoora
Abu Attifel
Nasser/
ZeltenIntisar
Gialo
Sarir N

Sarir
Waha
Defa/Defa S

Sarir

Atshan

Sebha
Ubari

El-Sharara Murzuk fields A-P

Elephant

Murzuk

Crude oil f ield

Gas/condensate f ield
Ref inery in operation
LNG plant
Scattered mine f ields

Crude oil pipeline

Gas pipeline
Damaged oil f acility
Tanker terminal

0 km

160

Initially, we assume production from the smaller offshore Bouri and AlJurf fields, with a combined
nameplate capacity of around 100kb/d, will be restarted relatively quickly. This offshore oil, however, is
heavier,sourcrudesratherthanthecountrystypicallight,sweetgrades.
An additional 250kb/d will come from the Mesla and Sarir fields in the eastern region once repairs to
pipelines andpump stations are completed. Indeed,AGOCO reportedon 12 September that it was in the
processofstartingupproductionatSarir.ThecrudewillflowtotheMarsaelHarigaterminalnearTobruk
butwithacapacityofonly150kb/d,theremainingcrudewouldhavetobeblendedwithothergradesand
exportedfromthelargerRasLanufterminal.However,itisunderstoodthattheRasLanufrefining,terminal
andportcomplexsufferedsignificantdamagesanditmaytakemonthsforrepairs,cappingexportstothose
outofTobruk.

18

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

S UPPLY

Non-OPEC Overview
NonOPECoilsupplyisestimatedtohaveincreasedby0.8mb/dto52.9mb/dinAugust,largelydueto
increasingoutputfromtheUS,LatinAmerica,andCaspianregion.Thesegainsaremitigatedinpartby
decliningproductioninnonOECDAsiancountries.Areviewoffieldlevelandhistoricaldataforthefirst
halfof2011,aswellasrevisedestimatesfromOECDcountriesforMayandJune2011,hasresultedina
baseline revision of 0.1mb/d for the second quarter of 2011. This suggests that output during the
secondquarterwas52.2mb/dor0.4mb/dlowerthanduring2Q2010.Duringthethirdquarterof2011,
theonsetofheavyNorthSeamaintenanceandotherunplannedoutagesincludinghurricanes(seechart
below)restricttherisein2Q11to3Q11nonOPECsupplyto0.4mb/d.

mb/d
55

Non-OPEC Total Oil Supply

mb/d
1.4

Total Non-OPEC Supply, y-o-y chg

1.2

54

1.0

53

0.8

52

0.6

51

0.4

50

0.2
0.0

49
Jan

Mar May
2008
2010
2011 forecast

Jul

Sep
Nov Jan
2009
2011
2012 forecast

-0.2
-0.4
1996

2000

2004

2008

2012

Withbaselinerevisionsfor2011included,our2H2011forecastisreviseddown330kb/d.Revisionsstem
primarily from heavier than expected maintenance in Denmark, Norway, and Kazakhstan. A review of
recent NGL and biofuels production trends for the first half of 2011 has also resulted in a combined
downwardrevisionof35kb/dforAsiaandOECDEuropesNGLproductiongrowthfortheyearasawhole,
and a 40kb/d downward revision to global biofuels annual production growth, largely due to Brazilian
ethanol production. Unplanned outages in China (oil spill) and Yemen (pipeline sabotage and worker
strikes) account for 50kb/d and 15kb/d of this annual revision, respectively. In sum, 2011 growth in
nonOPECsupplyisexpectedtototal190kb/d,around200kb/dlowerthanlastmonthsestimate.

SomeofthesechangesnecessitateareassessmentofournonOPECsupplyoutlookfor2012,whichhas
now been revised downwards by 150kb/d to 1.0mb/d. Around 65kb/d of the 2012 revision is due to
lowerthanexpectedNGLproductiongrowthinAsia,OECDEurope,andBrazilin2011,whichhasbeen
carried through our outlook. Global biofuels are also kb/d
Non-OPEC Supply 2011
Selected Shut-ins & Adjustments
revised downwards by 20kb/d in 2012. Other major
0
negativechangestothe2012outlookstemfromanalysis
-200
of fieldlevel data in Russia, Oman, Kazakhstan, Brazil,
and Australia, which show output levelling off at a
-400
numberoffieldspreviouslyunderpinningsupplygrowth.
-600

-800
Ouroutlookfor2012of1.0mb/dgrowthremainslargely
consistentwithourfirstassessmentintheJulyreleaseof -1000
1Q
2Q
3Q
4Q
the MTOGM. At that time, we estimated 2011 annual
North Sea maintenance
US hurricane adjustment
productiongrowthatslightlyover0.5mb/d,incontrast
UK Buzzard and other outages
Norway other outages
Argentina protests/damage
Canada Horizon fire
to0.2mb/dinthismonthsforecast.Itisworthpointing
Malaysia Kikeh outages
Sudan outages
Yemen outages
outthatunexpectedoutageswillreduce3Q11outputby
around0.4mb/d,somethingthatisnotenvisagedcarryingthroughinourforecastfor2012tothesame
degree.Wecustomarilyassumeamoremodest0.2mb/dannualadjustmentinouroutlook,largelyfor
potentialequipmentfailuresatmatureassetsintheOECD.

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Non-OPEC Supply
(million barrels per day)

1Q10

2Q10

3Q10

4Q10

2010

1Q11

2Q11

3Q11

4Q11

2011

1Q12

2Q12

3Q12

4Q12

2012

14.0

14.0

14.1

14.4

14.1

14.4

14.2

14.0

14.4

14.2

14.5

14.3

14.2

14.5

14.4

Europe

4.5

4.2

3.8

4.2

4.2

4.1

3.8

3.9

4.3

4.0

4.2

3.9

3.9

4.1

4.0

Pacific

0.6

0.6

0.6

0.6

0.6

0.5

0.5

0.6

0.6

0.6

0.7

0.7

0.7

0.7

0.7

Total OECD

19.1

18.8

18.5

19.2

18.9

19.0

18.5

18.4

19.3

18.8

19.4

18.9

18.8

19.3

19.1

Former USSR

13.7

North America

13.5

13.5

13.5

13.6

13.5

13.6

13.6

13.6

13.7

13.6

13.7

13.8

13.6

13.8

Europe

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

0.1

China

4.0

4.1

4.1

4.2

4.1

4.2

4.2

4.2

4.2

4.2

4.3

4.3

4.3

4.3

4.3

Other Asia

3.7

3.7

3.7

3.7

3.7

3.6

3.5

3.5

3.5

3.5

3.5

3.5

3.5

3.5

3.5

Latin America

4.0

4.1

4.1

4.1

4.1

4.2

4.2

4.3

4.5

4.3

4.5

4.6

4.6

4.6

4.6

Middle East

1.7

1.7

1.7

1.7

1.7

1.7

1.6

1.6

1.7

1.7

1.7

1.7

1.7

1.7

1.7

Africa

2.5

2.5

2.5

2.5

2.5

2.5

2.5

2.5

2.5

2.5

2.6

2.6

2.6

2.6

2.6

29.6

29.7

29.9

30.0

29.8

30.1

29.6

29.9

30.2

30.0

30.5

30.5

30.4

30.5

30.4

Total Non-OECD
Processing Gains

2.0

2.1

2.1

2.1

2.1

2.2

2.1

2.1

2.2

2.2

2.3

2.2

2.2

2.3

2.3

Global Biofuels

1.4

2.0

2.1

1.8

1.8

1.5

1.9

2.1

1.9

1.9

1.6

2.0

2.4

2.1

2.0
53.8

Total Non-OPEC

52.2

52.5

52.6

53.1

52.6

52.7

52.2

52.6

53.7

52.8

53.8

53.6

53.8

54.1

Annual Chg (mb/d)

1.3

1.2

0.9

0.9

1.1

0.6

-0.4

0.0

0.6

0.2

1.1

1.4

1.2

0.5

1.0

Changes from last OMR (mb/d)

0.0

0.0

0.0

0.0

0.0

0.0

-0.1

-0.4

-0.3

-0.2

-0.1

-0.2

-0.2

-0.2

-0.2

OECD
North America
USJulyAlaskaactual,otherstatesestimated:USoilsupplydippedtoanestimated7.6mb/dinJulyas
outputatAlaskasPrudhoeBayfieldfellby0.1mb/dduetoassumedsummermaintenance,augmented
bysomeminorleaksinJuly.InAugust,preliminarydatashowthatfieldoutputhasreboundedtopre
maintenancelevelsbytheendofthemonth,raisingtotalUSoiloutputto7.8mb/d.WeexpectGulfof
Mexico production to fall by around 220kb/d from August to September due to hurricanerelated
disruptions based on a fiveyear average. Hurricane Lee has already reduced monthly Gulf of Mexico
outputbyroughly165kb/datthetimeofwriting.HistoricalupwardadjustmentsinColoradoandNew
Mexico,aswellasadownwardadjustmenttoWyoming,fromPetroleumSupplyMonthlydatahavebeen
carriedthroughtheforecast.Thishasresultedinannualproductionestimatesthatare10kb/dhigherin
both2011and2012,bringingUSsupplytoaround7.9mb/dinthoseyears.

mb/d
8.6

Total US Oil Supply

mb/d
4.0

Total Canada Oil Supply

7.6
3.5
6.6

5.6

3.0
Jan

Mar May
2008
2010
2011 forecast

Jul

Sep Nov Jan

2009
2011
2012 forecast

Jan

Mar May
2008
2010
2011 forecast

Jul

Sep Nov Jan

2009
2011
2012 forecast

CanadaJuneactual:SecondquarteroilproductioninCanadaexceededexpectationsby6kb/dlargely
as a result of higherthanexpected bitumen production in June 2011. Rebounding production from
Suncor in June and expectations of increased production from new wells at Hibernia offset reduced
production from the CNRL Horizon mine/upgrader and declining production in Saskatchewan. CNRL
reports that production restarted at 75kb/d in midAugust and should return to prefire levels of
110kb/dinacoupleweeks.InareversalofgrowthshownoverthelastsixmonthsfromSaskatchewan,
2Q11outputisnow30kb/dbelow1Q11levels,raisingthepossibilityoffurtherforecastdowngradesin
monthstocome.Canadianoiloutputshouldaverage3.6mb/din2012,anincreaseof160kb/dfrom
2011levels.

20

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MexicoJulyactual:Mexicancrudeoilproductionfellby21kb/dinAugustcomparedtopriormonth
levels.Overall,Mexicosoutputcontinuestodecline,and2Q11crudeoiloutputis5kb/dlowerthanthe
2010 equivalent. Despite rising production from northern onshore areas and the Chicontepec field,
whichisnowproducingaround50kb/d,outputattheKuMaloobZaap(KMZ)fieldhasdroppedbackto
4Q10 levels of slightly more than 800kb/d. For the remainder of 2011, we expect KMZ output to
rebound to 840kb/d. Mexico is looking to Pemexs new service contract model to stem declining oil
output. Three new offshore projects, Ayin, Tsimin and Xux, could add 2080kb/d by 2015 and new
production at the KMZ complex from Kayab and Ayatsil could add 90100kb/d over the same
timeperiod.

North Sea
Norway June actual, July provisional: Following a fasterthanexpected ramp up of seasonal
maintenance and the delayed restart of the Visund field due to technical problems, Norway total oil
productionhasbeenreviseddownwardsby40kb/dand90kb/dinJuneandJuly,respectively.Itisnow
seentoaverage1.94mb/dand2.05mb/dinJuneandJuly,with2Q11assessedat1.99mb/d,adropof
200kb/d when compared to the previous quarter. Maintenance and other outages are estimated at
167kb/dfor3Q11,ofwhichalmosthalfisduetoseasonalmaintenance,andwillkeepoverallproduction
flat during the third quarter with no pronounced uptick expected until 4Q11. Recent reports indicate
that therestartofthefiredamagedValhallplatformhasbeen delayed untilthe middle ofSeptember,
resultinginloweroutputexpectationsfortheremainderof2011.

mb/d
2.8

mb/d
1.8

Norway Total Oil Supply

UK Total Oil Supply

1.6
2.3

1.4
1.2

1.8

1.0
Jan

Mar May
2008
2010
2011 forecast

Jul

Sep Nov Jan

2009
2011
2012 forecast

Jan

Mar May
2008
2010
2011 forecast

Jul

Sep Nov Jan

2009
2011
2012 forecast

UK June actual: Following widespread maintenance, June UK oil production has been revised
downwardsby70kb/dto1.1mb/dandisnowassessedat1.2mb/din2Q11.Juneoutputfellby40kb/d
from May, with the downward trend continuing into July and August, as the maintenance season
reacheditsseasonalpeak,beforeanuptickinSeptember.Outputhasbeentrimmedby5kb/dinboth
August and September because of the shutin of the Gannet A platform following its widely reported
leak.However,inSeptemberthishasbeenoffsetbythereturnoftheBuzzardfieldfrommaintenance.
Thefieldiscurrentlyexpectedtorampuptoitspremaintenancelevelof205kb/dbyOctober.TotalUK
productionisnowestimatedtoaverage1.24mb/din2011,increasingto1.26mb/din2012.

Pacific
Australia June actual: For Australia, June data show production remained at a lowerthanexpected
420kb/d,althoughoutputshouldincreaselaterintheyearwithreboundingvolumesfromtheCossackand
VanGoghfieldsandnewoutputfromtheKitanandPyreneesfield.Ouroutlookenvisagesthatproduction
maintains an upward trajectory in late2011 and 2012. Downwardadjusted 2011 and 2012 production
levelsnowaverage470kb/dand600kb/d,respectively.DownwardrevisionsstemfromlowerrecentNGL
output,whichwe havecarried throughtheforecast,andfroma detailedfieldlevel reviewofsourcesof
expectedgrowthfromtheCarnarvonandBonaparteBasins.TheSkuaandMontarafieldsintheBonaparte
basinarestillexpectedtocomeonlineinJanuary2012andshouldadd35kb/dtoAustraliasoutput.

13S EPTEMBER 2011

21

S UPPLY

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Non-OECD Asia
ThailandJuneactual:OutputfromThailandisaround10kb/dlowerin1H11thanthesameperiodlast
year,showingalmostnogrowthinNGLandcondensateoutput.Governmentreportedcondensateoutput
of79kb/dinJunewasthelowesttotalsinceNovember2009.WehadforecastsomegrowthinNGLand
condensateoutput,butreviewingsixmonthsoflowerthanexpectedoutput,wehavereviseddownward
ourassessmentoftotalThaioiloutputbyaround14kb/deachin2011and2012.

IndonesiaJuneactual:DespitegovernmentforecaststhatIndonesiasoutputwillreach1mb/dagain
by2013,recentoutputstatisticsshowadownwardtrend.Overall,oiloutputforthelastsixmonthshas
fallenby75kb/dversusthesameperiodin2010,ofwhich12kb/disfromdecliningNGLoutput.New
governmentreportedhistoricaldataforNGLoutputhasreducedIndonesianoutputby10kb/dfor2011,
and our estimate for 2012 by 7kb/d. We estimate Indonesian crude oil production will continue to
declinefrom910kb/din2011to860kb/din2012.

ElsewhereinnonOECDAsia,inVietnamtheTeGiacTrangcrudeoilfieldbeganproducingat16kb/don
22August,andisexpectedtorampuptolevelsof4055kb/dbytheendoftheyear,inlinewithour
forecast.OveralloutputfromVietnamisassessedat300kb/dinJune,butshouldrampupto330kb/d
byyearendwithaddedoutputfromTeGiacTrangandtheDaiHung(BigBear)field.

China July actual: Chinas oil production fell by mb/d

Total China Total Oil Supply
100kb/d to 4.1mb/d in July, due primarily to shut in
4.5
production at the Peng Lai 193 field in Bohai Bay. We
assume the shutins to last into September but are 4.3
partially offset by sustained production growth 4.1
elsewhere. Production for 2011 is estimated to average
4.2mb/d, which would represent annual growth of 3.9
80kb/d, or +2%. In 2012, production is expected to 3.7
rebound to 4.3mb/d on resumed Peng Lai volumes and
Jan
Mar May
Jul
Sep Nov Jan
Chinese producers ability to stem decline at some of its
2008
2009
2010
2011
largest and mature fields. For example, oil production
2011 forecast
2012 forecast
from the over fiftyyearold Daqing field averaged
800kb/din2009,but1H2011datashowthatthefieldhassustainedoutputatlevelsofalmost810kb/d.
Alltold,thePengLaileaks(seebelow),knock50kb/doffour2011Chineseoutlookand30kb/dfrom2012.

Leak at ConocoPhillips Peng Lai 19-3 field to reduce 2H2011 Chinese output
TwoseparateoilleakswerediscoveredatthePengLai193fieldinChinasoffshoreBohaiBay,atplatformB
on4JuneandplatformCon17June.Theseplatformswereproducingaround47kb/dupuntilChinasState
Oceanic Administration (SOA) ordered a production suspension on 13 July. In June, the Peng Lai field
producedaround150kb/dfromsevenplatforms,whichincludes181producingwellsand54injectingwells.
AfterfurtherleakswereidentifiedinAugust,theSOAorderedtheshutdownoftheentire193field.Based
on CNOOC and ConocoPhillips statements, we estimate that the suspension of output reduced total
productionby31kb/dinJuly,47kb/dinAugust,and150kb/dinSeptember.Lookingforward,webelieve
thefieldcouldtohavedifficultyreachingitsformerpeakproductionlevelsduetooperatorsafetyconcerns
anddamagetothereservoirfromtheshutin.WeassumeplatformsBandCremainofflineuntillateinthe
fourthquarter,andweexpecttheotherplatformstoreturnsooner.

22

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

S UPPLY

Former Soviet Union (FSU)

RussiaJulyactual,Augustprovisional:Russia'soiloutputhitanotherpostSoviethighof10.6mb/din
August, driven by expanding output at TNKBP greenfields, sustained output at Rosneft and Gazprom
Nefts brownfields, and continued growth in condensate output from Gazprom. The Russian energy
ministryhasrevisedupitsoilproductionforecastfor2011by100kb/d,andsaystheintroductionofa
new export tax regime on 1 October should lead to higher exports (see Russia: Upstream and Export
Impacts of the 6066 Tax Regime). We have revised up our estimates for Russian supply for 2011 and
2012duetorecentproductiondatashowinghigherthanexpectedproductionfromBashneft,Russneft,
and TNKBP. At the Uvat fields in West Siberia, TNKBP plans to further increase output by 17kb/d by
yearendwithnewwells.Also,TNKBP'sVerkhnechonskoilfieldinEastSiberiahasmovedupitstargetto
reachpeakproductionof154kb/dto2014.

ExxonMobil and Rosneft recently announced plans to develop hydrocarbon deposits in the Russian
sectors of the Arctic and Black Sea. The investment planned for the two areas is $3.2 billion and
ExxonMobil will receive a 33.3% share in each newlyestablished JV. Rosneft receives the remaining
shares and also receives footholds in several Gulf of Mexico, Texas, and Canadian deposits where
ExxonMobil is active. Looking forward much will depend on government followthrough to ease tax
constraintsforArcticexplorationandtheresultsofexplorationintheKaraSea,wheretheseismicdatais
veryuncertain.

Russia: Upstream and Export Impacts of the 60-66 Tax Regime

Russiaisexpectedtointroduceanewcrudeandexport kb/d
Russian Crude Production by
duty regime on 1 October after various government
Company - Annual Change
300
ministriesandPrimeMinisterPutinagreetotheplan.
Although the new tax system aims to modernise
200
Russias downstream sector, there are mediumterm
100
implications for oil supply, export levels, and Russian
0
budget revenues. The new 6066 tax regime will see
themarginalexporttaxformostcrudeoilexportscut -100
to60%ofthepriceofUrals,from65%currently,anda -200
unifiedoilproductstaxratesetat66%ofthedutyfor
2009
2010
2011
2012
Urals. Although Prime Minister Putin signed the order
Yukos
Rosneft
Lukoil
TNK
Surgut
Gazpromneft PSAs
Tatneft
toequalisetheexportdutyforrefinedproductsatthe
Bashneft
Sidanco
Slavneft
Others
endofAugust,theplantoreducethecrudeoilexport
dutyto60%requiresaseparategovernmentdecreetobesignedlaterbyPrimeMinisterPutin.Theexport
dutyforgasolineandnaphthawillremainat90%oftheexportdutyforUrals(setatthatlevelsinceend
Apriltolimitexportsanddomesticshortages),butshould,accordingtoenergyministerShmatko,gradually
declinetothe66%setforotherproductsovercomingmonths.Theexportdutyforlightandheavyproducts
iscurrently67%and46.7%respectivelyofthatofUrals(SeeRefiningsectionformoredetails).
ThemajorimplicationforupstreamfocusedcompaniesinRussiaisthatitsecuresthemadditionalcashflow.
Rosneft,Tatneft,TNKBP,andSurgutneftegazarepoisedtobenefitthemostfromtherebalancingaccording
to Russian analysts. Integrated companies, which derive most of their profits from their downstream
segments(suchasBashneft)couldseereducedoverallprofitability,andanalystsexpectthegovernmentto
compensate them with lower mineral extraction tax (MET) rates or discounts on rail product
transporttariffs.
A 5% reduction in crude export duty would allow producers to improve brownfield well productivity.
Production from mature fields with high lifting costs and low flow rates could see enhanced productivity
underthenewregimebecauseitincreasesthenumberofprofitablewells.Oneinvestmentbankestimates
thatthereturnonanaverageLUKoilWestSiberianbrownfieldwellwouldincreasefromlessthan10%to
over20%.Broadlyspeaking,analystsestimatethatata$100/barrelcrudeprice,upstreamunitprofitability
increasesby$4/barrel.

13S EPTEMBER 2011

23

S UPPLY

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Russia: Upstream and Export Impacts of the 60-66 Tax Regime

(continued)

The new tax regime is likely to favour the exportingof crude over products, but this does notnecessarily
meanthatcrudeshipmentswillrisebeyond9mb/dbecauseofincreasingdomesticdemandforcrude.So,
what does this mean for our outlook on oil production? The companies that will benefit directly from the
change in crude export duties comprise around half of Russian oil output. Due to output performance
exceeding our expectations in 2010 and the first half of 2011, our outlook already includes 45kb/d annual
growthfor2012,includinggrowthofover120kb/dfromRosneftsfields.Althoughthe6066changesshould
increasebrownfieldproduction,integratedcompaniesarestillexpectedtoseetheirrefiningmarginsreduced.
Also,thechangesareunlikelytoaffectRussiasgreenfieldoutput.Onthedownside,itisworthnotingthatin
addition to losing its crude export duty discount, Rosnefts 300kb/d Vankor field has also lost its mineral
extractiontaxexemption.
On balance, although the government seems committed to introducing these tax changes by 1 October,
manyobservershopeforbroaderchangestotheoilsectortaxregimesuchastheintroductionofaprofits
based, ratherthan revenuesbased, tax regime that would benefitgreenfield production in frontier areas.
The government also recently introduced a reduction in the mineral extraction tax for small fields
(<18millionbbl).Toaddtotheuncertainty,thisisanelectionyearinRussia,whichmeansthegovernment
could repeal these exemptions to maintain steady budget revenues especially if oil prices fall. All told
therefore,wehavenotsubstantiallychangedourproductionoutlookbecauseofthetaxchangesduetothe
remaininguncertaintywiththeimplementationofthecrudeoilexportdutyreduction.

Kazakhstan July actual: In July, Kazakhstans oil production fell to 1.5mb/d with unexpected
additionalmaintenanceatthe550kb/dTengizfield,whichreducedoutputbyaround150kb/d.Julydata
also show the marginal effect on production of the oil workers strike on Karazhanbasmunay and
Uzenmunaigasproduction.ThestrikecontinuedtoaffectsimilarlevelsofoutputinJulyandintoAugust.
WhilecrudeoilproductiongrowthprospectsinKazakhstanremainlargelyunchangedfromlastmonths
outlook,theongoingshareholderdisputeattheKarachaganakgasandgascondensatefieldhascaused
ustokeepoutputstaticatthefield.Recentreportsindicatearesolutioninupcomingmonths,butthis
has delayed implementation of the fields Phase III expansion. The expansion would have cost up to
$23billionandresultedinaround30kb/dofadditionalcondensateoutput.

FSU Net Exports of Crude & Petroleum Products

(million barrels per day)

2009

2010

3Q2010 4Q2010 1Q2011 2Q2011

May 11 Jun 11

Jul 11

Latest month vs.

Jun 11 Jul 10

Crude
Black Sea

2.28

2.10

2.12

2.02

2.06

1.87

1.81

1.82

1.69

-0.13

Baltic

1.60

1.60

1.56

1.60

1.48

1.57

1.54

1.43

1.34

-0.09

-0.58
-0.25

Arctic/FarEast

0.46

0.74

0.67

0.78

0.70

0.69

0.69

0.66

0.64

-0.02

-0.08

BTC

0.80

0.77

0.81

0.80

0.72

0.76

0.70

0.79

0.69

-0.10

-0.13

Crude Seaborne

5.15

5.22

5.17

5.19

4.96

4.89

4.74

4.71

4.36

-0.35

-1.03

Druzhba Pipeline

1.11

1.13

1.16

1.14

1.14

1.12

1.11

1.10

1.17

0.07

-0.02

Other Routes

0.40

0.42

0.40

0.43

0.53

0.54

0.53

0.55

0.55

0.00

0.15

Total Crude Exports

Of Which: Transneft1

6.66

6.76

6.73

6.76

6.63

6.55

6.38

6.36

6.08

-0.27

-0.90

3.93

4.00

4.04

4.02

4.15

4.16

4.17

3.94

4.05

0.11

-0.21

Products
Fuel oil2

1.41

1.54

1.63

1.51

1.43

1.82

1.79

1.88

1.70

-0.19

-0.01

Gasoil

0.95

0.88

0.82

0.81

0.90

0.79

0.79

0.74

0.71

-0.03

-0.16

Other Products

0.53

0.43

0.43

0.37

0.48

0.53

0.58

0.45

0.40

-0.05

-0.06

Total Product

2.89

2.85

2.88

2.69

2.81

3.14

3.15

3.07

2.80

-0.27

-0.23

Total Exports

9.54

9.61

9.61

9.45

9.44

9.68

9.53

9.43

8.89

-0.54

-1.13

Imports

0.06

0.07

0.08

0.10

0.08

0.09

0.07

0.12

0.06

-0.06

0.00

Net Exports

9.49

9.54

9.53

9.35

9.37

9.59

9.45

9.31

8.82

-0.48

-1.13

Sources: Argus Media Ltd, IEA estimates

1

Transneft data exclude Russian CPC volumes.

Includes Vacuum Gas Oil

24

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

S UPPLY

FSUnetoilexportsreachedtheirlowestlevelsinceend2008inJuly,downby480kb/dto8.82mb/d,
withthefallevenlysplitbetweencrudeandproducts.Crudeshipmentsfellto6.08mb/d,90kb/dlower
thanthepreviousyear,inresponsetosupplyproblemsoutsideofRussia.Notably,Azerivolumeswere
disruptedfollowingscheduledmaintenanceontheChiragplatformandtheBakuSupsapipeline.Black
Seacargoesdroppedby130kb/dwhileflowsontheBTCpipelinefellby100kb/d.StrikesinKazakhstan
also began to bite, with deliveries through the CPC pipeline decreasing by 20kb/d. In comparison,
exportsthroughtheRussianTransneftnetworkroseby110kb/d,withDruzhbaflowsupby70kb/don
themonthasdeliveriesalongtheNorthernlegtoPolandgrewby100kb/d.IntheBaltic,shipmentsfrom
Primorskfellby90kb/dfollowingmaintenanceontheBalticPipelineSystem.IntheEast,althoughfields
supplyingtheESPOsawexporttaxbreaksremovedfrom1August,Kozminoloadingschedulessuggest
pipelineflowscouldcontinueunabated.

Productexportsfellbyalmost50%(270kb/d)to2.80mb/d,ledbyanexceptional190kb/ddropinfuel
oil shipments (including vacuum gas oil). Reasons for this slump are unclear with reports suggesting a
combination of a fall in refinery throughput, increasing domestic demand and after government
pressure, refineries reorientating to stockpile more light products, were responsible. Additionally, the
90%gasolineandnaphthaexporttaxrecentlyintroducedinresponsetodomesticgasolineshortageshas
hadthedesiredeffectofreducingshipmentsby80kb/d.Septemberproductvolumesmayreboundin
expectationofthenew6066fiscalregime(see:Russia:UpstreamandExportImpactsofthe6066Tax
Regime).However,crudeexportsareexpectedtoremainlow,aspipelineandfieldmaintenancereaches
aseasonalpeak.

Other Non-OECD
Total Brazil Oil Supply
BrazilJuneactual:Oiloutputremainedat2.2mb/din mb/d
2.6
thesecondquarter,onparwithfirstquarterlevels.On
amonthlybasis,crudeandNGLoutputroseby65kb/d
inJune,butgrowthinoutputfromBrazilduring3Q2011
fromthestartupoftheMarlimSulfieldismitigatedby 2.1
seasonal maintenance at platforms in several offshore
fields,includingMarlim(P20,P35andP37),Albacora
Leste (P50), Parque das Baleias (FPSO Capixaba), and 1.6
unitsoftheCabinaschain.Inaddition,wehaverevised
Jan
Mar May
Jul
Sep Nov Jan
theethanoloutputforecastby30kb/din2011andby
2008
2009
2010
2011
20kb/d in 2012 because of a disappointing sugar cane
2011 forecast
2012 forecast
harvest. In sum, we estimate that output from Brazil
during 2011 and 2012 will average 2.2mb/d and 2.4mb/d respectively, mostly on par with growth
estimatesfromlastmonthsassessmentandnotincludingthechangestobiofuelsproductionestimates.

In Yemen, although some 110kb/d of shutin crude oil production resumed in midJuly, the Marib oil
pipeline,whichcarriescrudetotheRasIssaterminal,wasbombedagaininlateAugust.Reportsindicate
that the pipeline was repaired and capacity was restored. However, companies report that drilling
operationshavebeenstopped,whichmeanstheremaybelongertermimplicationsforYemensoutput.
Wehaveconservativelyreducedoutputby125kb/dinSeptemberpendinghistoricaldatashowingthat
outputhasindeedreachedearlierlevels.Nexen,whichoperatestwoblocksinYemenreportedthatits
production is suffering from natural field declines following the completion of development drilling
activities.Intheabsenceofanagreementtorenewitsexistingtwoconcessionsandwiththethreatof
worker strikes, Nexens 35kb/d output is expected to fall further. Downward revisions to surrounding
monthsfromtheaforementionedpipelinedisruptionhaveloweredYemensoutputin2011tojustover
200kb/d,whichis70kb/dlowerthan2010anda15kb/drevisionfromlastmonthsestimate.

13S EPTEMBER 2011

25

S UPPLY

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

In Oman, an analysis of Ministry of National Economy and JODI data has caused us to reassess our
baseline production estimate, thereby reducing our estimate for 2H11 and 2012 output by 20kb/d. A
fieldlevelanalysisindicatesthatproductionfromtheOccidentalMukhaiznaEORprojectmaytakelonger
toreachtargetedlevelsof150kb/dduetoquadrupledprojectcosts.Thus,wehavereviseddownwards
ourestimatesby15kb/dforthisproject.Insum,OmanscrudeandNGLoutputareexpectedtogrowto
930kb/dby2012,anincreaseof40kb/dfromprojected2011levels.

InSubSaharanAfricawehaverevisedoutputdownwardsinUgandaandGhanaduetorevisedproject
timelinesreportedbyUKbasedTullowOil.InGhana,Tullowmodifieditstimetableforpeakproduction
from the Jubilee field and is now set reach 105kb/d in October and 120kb/d by the end of the year,
downfromoriginalplanstoreach120kb/dinAugust.Tullowattributedthedelaytowaterreinjection
problems.InUganda,TullowprojectsfirstoilfromtheAlbertbasinin2015,whichislaterthanearlier
estimatesthatassumedsomeinitialproductionduring2012.Asaresult,Ugandanoutputistrimmedby
10kb/dtozeroin2012.

New EU Sanctions on Syria Unlikely to Affect Syrian Crude Oil Production

EUsanctionsonSyrianoilimportsbanthepurchaseandtransportofSyriancrudeandrefinedproducts.The
regulationalsobanstheimportofcrudeorpetroleumproductsiftheyoriginateinorhavebeenexported
from Syria. Existing contracts that were concluded prior to 3 September are exempt from the sanctions
until15November.TheembargowillnotbanthesupplyofrefinedproductsfromtheEUtoSyria,norwillit
seek to prevent European companies from delivering Syrian oil to nonEU countries. US sanctions already
restrict investment in the country, and further
Syria crude exports to OECD Europe
EUsanctions if they occurred, to include the
APIo Sulfur
2010 1H2011
operations of nonUS companies, could have a more
(kb/d)
(kb/d)
longtermimpact.
Syria Light
38
0.68
39
25
23.12
4.19
118
99
Syria has two primary crude blends, Syrian Light and Souedie
Total
157
124
Souedieh. Souedie, produced from the Souedie and
Source: IEA, Total
Jebeisseh fields, is heavy and high in sulphur, while
SyrianLightcomesfromproductionattheAFPCJV(Shell,80kb/d)andTotalsDeirezZor(25kb/d).Based
ondatasubmissionsfromIEAmembercountries,weestimatethatSyriaexported157kb/dofcrudeoilin
2010 and 127kb/d in 1H11 to OECD Europe countries. Based on data from Syrias General Petroleum
Corporation(GPC),anadditional26kb/dofcrudeexportswenttononOECDcountriesinthefirsthalfofthe
year.ItisalsoworthnotingthatthereisanecdotalevidenceofChineserefinerstakingcrudeoilfromSyria.
The loss of around 25kb/d of Syria light crude to European refiners is unlikely to have a large impact on
European refinery operations, although it might cost refiners more to find substitute crude oil to replace
Syrialight.ReportsindicatedthatItaly,thedestinationofover60%ofSyriancrudeoil,hadrecentlybeen
takingmoreSyriancrudetosubstituteforlostLibyanexports.

WedonotbelievethatthesanctionscurrentlyinplacewillaffectcrudeoilproductionvolumesfromSyria,
which the IEA estimates at 332kb/d in August, although they could exacerbate alreadydeclining mature
production in the country. Depending on the extent to which Syria discounts its Souedie blend crude oil,
thesevolumesshouldfindothercustomerselsewhere.OilmarketingorganizationSytrolisalreadyreported
tobeexploringAsianmarketsforSyrianexports.

26

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

OECD S TOCKS

OECD STOCKS

Summary
OECDindustryoilinventoriesroseby10.8mbto2687mb,or58.4daysofforwarddemandcover,
inJuly.Seasonalproductrestocking,ledbygainsinmiddledistillatesandotherproducts,drovethe
overall monthly gain, while counterseasonal declines in crude and other oils provided a partial
offset.TheJulybuildwasweakerthanthetypical26.8mbseasonalincrease.Asaresult,inventories
fell12.8mbbelowthefiveyearaverageand81mbbelowyearagolevels.Thisisthefirsttimetotal
oilindustrystockshaveslippedbelowthefiveyearaveragesincetheeconomicrecessionof2008.

Preliminary data indicate a modest 0.6mb build in OECD industry oil stocks in August. Stronger
refinery runs reduced industry crude holdings by 10.6mb, while product stocks rose by 13.8mb.
Althoughtheproductsincreaseandcrudedrawmimictypicalseasonaltrends,thelastfiveyearshave
seenamuchlargeraverage14.0mbAugust build. Thestocklevelsaresubject torevisionupon the
receipt of more complete data next month, yet OECD inventories appear to have remained tight in
August,at26.3mbbelowthefiveyearaverageand108mbbelowyearagolevels.

Shorttermoilfloatingstoragefellto48.3mbinAugust,downfrom50.5mbinJuly.Offshorecrude
oil holdings declined to 37.6mb, as some Iranian volumes were offloaded in the Middle East Gulf.
Refined products held in floating storage fell to 10.7mb in August, as discharged volumes in the
MiddleEastGulf,AsiaPacificandNorthwestEuropeoutweighedincreasesoffWestAfrica.
OECD Total Oil Stocks

mb

mb

2,800

200

2,750

150

2,700

100

2,650

50

2,600

2,550

-50

2,500
Jan Mar May
Jul
Range 2006-2010
2010

Sep Nov
Jan
Avg 2006-2010
2011

OECD Industry Total Oil Stocks

Relative to Five-Year Average

-100
Jul 09
Jan 10
Pacific
Europe

Jul 10

Jan 11
Jul 11
North Am erica
OECD

OECD Inventory Position at End-July and Revisions to Preliminary Data

OECDoilindustrystocksroseby10.8mbto2687mbinJuly.Bycontrast,inventoriesbuiltonaverageby
26.8mboverthepastfiveyears,drivenentirelybystrongproductgains.Thisyear,productrestocking
droveJulysincreaseinstocks,butstrongerrefineryrunscombinedwithlowerproductionreducedcrude
oil inventories counterseasonally. As a result of this weakerthanaverage monthly stockbuild, OECD
inventories fell 12.8mb below the fiveyear average and 81mb below yearago levels. This is the first
timetotalindustrystockshaveslippedbelowthefiveyearaveragesinceJune2008.
Preliminary Industry Stock Change in July 2011 and Second Quarter 2011
July (preliminary)
(million barrels)

Crude Oil
Gasoline
Middle Distillates
Residual Fuel Oil
Other Products
Total Products
Other Oils1
Total Oil

N. Am

Europe

-4.2
2.5
11.1
-0.5
13.9
27.1
-1.6
21.2

-11.7
-0.8
-1.5
-0.3
0.2
-2.4
-0.3
-14.3

Pacific

Total

1.8
-0.5
-0.1
-0.1
4.9
4.3
-2.3
3.8

-14.0
1.3
9.5
-0.8
19.0
29.0
-4.2
10.8

1 Other oils includes NGLs, feedstocks and other hydrocarbons.

13S EPTEMBER 2011

Second Quarter 2011

(million barrels per day)

(million barrels per day)

N. Am

Europe

Pacific

-0.13
0.08
0.36
-0.01
0.45
0.87
-0.05
0.69

-0.38
-0.03
-0.05
-0.01
0.01
-0.08
-0.01
-0.46

0.06
-0.02
0.00
0.00
0.16
0.14
-0.07
0.12

Total

-0.45
0.04
0.31
-0.03
0.61
0.93
-0.13
0.35

N. Am

Europe

Pacific

0.00
-0.02
-0.05
-0.01
0.35
0.27
0.17
0.44

-0.01
-0.12
-0.12
-0.03
0.04
-0.23
0.04
-0.20

0.01
0.01
0.14
0.01
0.02
0.18
0.06
0.26

Total

0.01
-0.12
-0.03
-0.03
0.40
0.22
0.27
0.50

27

OECD S TOCKS

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Asanticipatedinpreviousreports,refinersincreasedcruderunsoverthesummerinlinewithseasonal
trends.Nevertheless,anddespiteextrasupplyderivingfrombothOPECproducersandtheIEACollective
Action(seeIEALibyaCollectiveAction:OilfromGovernmentStocksRelievingtheMarket),thisresultedin
a counterseasonal 14.0mb crude draw in July. The decline was concentrated particularly in Europe,
wherecrudeoilstocksfell11.7mb,toalmost24mbbelowyearagolevels.At310mb,Europeancrude
stocks apparently stand at their lowest level since January2007, although these data are subject
torevision.

In contrast, OECD industry inventories of refined products soared by 29.0mb in July, with a build in
other products accounting for almost two thirds of the restocking. Middle distillates contributed by
gaining9.5mb,althoughtheaccumulateddistillateoverhangdiminished,narrowingto5.4mbabovethe
fiveyearaverageinJuly,from80mbtwoyearsago.Meanwhile,gasolinestocksrosecounterseasonally
by1.3mb,inpartduetoafairlyweakdrivingseasonintheUS.

OECD Distillate Stocks

mb

mb

Relative to Five-Year Average

100

360

80

350

60

340

40

330

20

320

310

-20
Jul 09

Jan 10
Pacific
Europe

Jul 10

300
Jan

Jan 11
Jul 11
North Am erica
OECD

OECD Europe Crude Oil Stocks

Mar May
Jul
Range 2006-2010
2010

Sep Nov
Jan
Avg 2006-2010
2011

OECD forward demand cover stood at 58.4 days in July, marginally higher than Junes 58.3days and
1.4days above fiveyear average levels. Stock cover rose modestly in July driven by gains in other
productsholdingsanddespitetheprospectsofrisingdistillatedemandoverthenextthreemonths.

Uponreceiptofmorecompletedata,estimatesoftotalOECDindustryoilholdingswerereviseddownby
1.1mb for June and by 1.0mb for May. Despite the downward revision to stock levels, the implied
monthly draw remains 11.9mb in June, in line with our previous assessments. Readings for distillates
andotherproductscameinlower,whileupwardadjustmentswerecentredongasolineandotheroils.

Revisions versus 10 August 2011 Oil Market Report

(million barrels)

North America

Crude Oil
Gasoline
Middle Distillates
Residual Fuel Oil
Other Products
Total Products
1
Other Oils
Total Oil

Europe

OECD

Jun 11

May 11

Jun 11

May 11

Jun 11

May 11

Jun 11

0.0
0.0
-0.4
0.3
-0.3
-0.4
-0.3
-0.7

-0.9
1.8
-5.9
-0.2
-4.5
-8.8
4.9
-4.8

-1.7
0.0
1.6
0.0
-0.1
1.5
-0.1
-0.3

1.6
0.2
0.0
-1.3
2.9
1.8
1.6
5.0

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

-1.3
0.6
0.6
0.0
-1.2
0.1
-0.1
-1.3

-1.7
0.0
1.1
0.2
-0.4
1.0
-0.4
-1.0

-0.7
2.7
-5.3
-1.4
-2.9
-6.9
6.4
-1.1

1 Other oils includes NGLs, feedstocks and other hydrocarbons.

Pacific

May 11

AccordingtopreliminarydatafromtheUS,JapanandEuroilstock,OECDindustryinventoriesremained
virtuallyflatinAugust,risingbyamodest0.6mb.Strongerrefineryrunsreducedindustrycrudeholdings
by 10.6mb, although deliveries from public stocks prevented a stillsharper draw from occurring.
Productstocksbuiltby13.8mb,drivenbydistillate,otherproductsandfueloilgains,whileadeclinein
gasolineinventoriesprovidedpartialoffset.Bycontrast,stocksroseonaverageby14.0mboverthepast
fiveyears,withsharpdistillateledbuildsinrefinedproductstendingtooutweighdrawsincrude.

28

13S EPTMEBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

OECD S TOCKS

IEA Libya Collective Action: Oil from Government Stocks Relieving the Market
OilfromgovernmentreservesreleasedaspartoftheIEALibyaCollectiveActionenteredthemarketsinJuly
andAugust,thusprovidingapartialrelieftoalreadytightmarketsconstrainedbylostLibyansuppliesand
production outages in the North Sea and elsewhere. Although OMR analysis focuses primarily on
developments in industry stocks in OECD countries, the most recent evolution in government holdings
merits a closer look. In addition, tables 4 and 5 in the annex of this report show the levels of both
governmentcontrolled(public)andindustrystocks.
Basedonavailabledeliveryschedulesweestimatedlastmonththatapproximately40%oftheover38mbof
publicoilstocksweredeliveredinJuly,withtheremaining60%likelytobetakenupinAugust.Preliminary
indications from governments now suggest that, as a result of the emergency stock release, public stocks
declined by at least 13.6mb in July. This draw accounts for 35% of total pledged oil volumes from
governmentreserves.However,themagnitudeofpublicstockdrawisonlyindicativeandwewillbeableto
better assess July deliveries from government stocks next month, after the receipt of complete inventory
data,includingadetailedbreakdownofpublicandindustryinventorylevels.
Thedrawfrompublicstockscanbeclearlyseeninthedata,butwithamultitudeoffactorsaffectingend
month industry stocks, a direct inverse relationship between public and industry stocks cannot be clearly
identified.Likewise,inthecaseofmandatoryindustrystocks,theloweringofstockholdingobligation,while
providingoperatorswithagreaterdegreeofflexibility,maynotdirectlytranslateintoastockchange.
mb

Deliveries of IEA Public Stocks

25

mb
750

US Weekly Crude SPR Stocks

730

20
15

710

10

690

670

650
Jan

Source: EIA

Jul-11
United States
Belgium
Germ any
Korea

Aug-11
Netherlands

Apr
Range 2006-2010
2010

Jul

Oct
5-yr Average
2011

The most recent consolidated information from the US Department of Energy, also available on their
website, indicates that all Strategic Petroleum Reserve (SPR) volumes were delivered by 31August as
originally scheduled, showing 8.3mb of crude were delivered in July and 22.3mb in August. This has
confirmed preliminary US weekly data showing adecline of 7.8mb of crude oil from the SPR in July, and
afurther21.1mbdropinAugust.
InEurope,preliminaryinformationindicatesthatatleast1.8mbofcrudeandproductsfrompublicstocks
were delivered to market participants. German governmentcontrolled stocks are estimated lower by
1.4mb, of which 1.1mb was likely crude and the remainder products. Preliminary information from the
Netherlandssignalatleasta0.4mbdrawincrudeoilpublicreserves.
InKorea,3.5mbofoilfromgovernmentreservesreachedthemarketinJuly.Firstindicationssuggestthat
almost2.0mbofcrudeoil,0.4mbofgasolineand1.2mbofdistillatesfrompublicreserveswereloanedto
industry,helpingtobolsterotherwisefairlytightregionalindustrystocks.

Analysis of Recent OECD Industry Stock Changes

OECD North America
CommercialoilinventoriesinNorthAmericasurgedby21.2mbto1356mbinJuly.Crudeoilinventories
declined seasonally by 4.2mb and stood below yearago levels following a rebound in regional crude
runs.Adeliveryof7.4mbofcrudefromtheUSSPRinJulylikelycounterbalancedthemonthlyindustry

13S EPTEMBER 2011

29

OECD S TOCKS

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

stockdraw.Atthesametime,higherrefinerythroughputsboostedproductinventoriesby27.1mb,as
otherproductsanddistillatesrosemoresharplythantheseasonalaverageanda2.5mbgasolinebuild
alsocontributed.

OECD North America Crude Oil

Stocks

mb
520
500
480
460
440
420
400
Jan

Mar May
Jul
Range 2006-2010
2010

Sep Nov
Jan
Avg 2006-2010
2011

mb
280
270
260
250
240
230
220
210
Jan

OECD North America Gasoline

Stocks

Mar May
Jul
Range 2006-2010
2010

Sep Nov
Jan
Avg 2006-2010
2011

EIA weekly data point to a 4.4mb increase in US industry stocks in August, including a 0.9mb contra
seasonalgainincrudestocks.The21.1mbofUSSPRdeliveredtoindustrybuyersinAugusthelpedoffset
heightenedrefineryactivity.Meanwhile,Cushinginventoriesfellby2.6mbto32.7mb,thelowestlevels
sinceNovemberlastyear,butstillwellabovefiveyearaveragelevels.Thedrawcamedespiteasharp
uptickincrudeimportsreportedintheUSMidwestattheendofAugust.

mb
390

US Weekly Industry Crude Oil Stocks

370
350
330
310
290
Source: EIA

270
Jan

Apr
Jul
Range 2006-2010
2010

Oct
5-yr Average
2011

mb
180
170
160
150
140
130
120
110
100
Jan

US Weekly Total Distillate Stocks

Source: EIA

Apr
Jul
Range 2006-2010
2010

Oct
5-yr Average
2011

AhikeinUSrefinerythroughputsprovidedsufficientproductsuppliestocoverforaseasonalincreasein
demandandthusraisedrefinedproductinventoriesby7.3mbinAugust.Thebulkofthemonthlystock
build came from a gain in other products (largely propane), but distillates and fuel oil stocks also
increasedandoutweighedagasolinedraw.

OECD Europe
In Europe, industry oil inventories plummeted by 14.3mb to 922mb in July, strongly contrasting with
amore typical 3.6mb seasonal build. Crude oil stocks contracted by 11.7mb to the lowest level since
January2007,followingthelossofLibyansuppliesand2Q11averagecrudeimportsof10.9mb/d,some
400kb/d lower than a year ago. Production outages and field maintenance in the North Sea and
elsewhereforcedrefinerstodelvefurtherintoindustrycrudeoilholdings,whichstoodatalmost32mb
belowthefiveyearaverageinJuly.Thatsaid,Julydataareprovisionalandsubjecttolaterrevision.

30

13S EPTMEBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

mb

OECD S TOCKS

m b/d
13.5

OECD Europe Crude Oil Stocks

360

13.0

350

12.5

340

12.0

330

11.5

320

11.0

310

10.5

300
Jan

OECD Europe Crude Oil Imports

Mar May
Jul
Range 2006-2010
2010

Sep Nov
Jan
Avg 2006-2010
2011

10.0
Jan

Apr
Jul
Range 2006-2010
2010

Oct
Jan
Avg 2006-2010
2011

Refined products held up rather better, with industry inventories dropping by a more modest 2.4mb
inJuly, driven by draws in all categories bar other products. An uptick in distillate demand curtailed
stocksby1.5mbandtheoverhangobservedoverthepastfewyearsalmostdisappeared.Thisrelative
tightness might continue as we forecast distillate demand in Europe to increase sharply inSeptember,
partly due to traditional restocking of German enduser heating oil stocks. At endJuly, German
consumerheatingoilstocksstoodat53%ofcapacity,upfrom50%amonthearlier.
mb
320

OECD Europe Middle Distillates

Stocks

German End-User Heating Oil Stocks

% of Storage Capacity

%
70
65

300

60

280

55

260

50

240

45

220
Jan

40

Mar May
Jul
Range 2006-2010
2010

Sep Nov
Jan
Avg 2006-2010
2011

Jan

Mar
May
Jul
Range 2006-2010
2010

Sep
Nov
Jan
Avg 2006-2010
2011

Preliminary Euroilstock data show total oil industry stocks fell by 0.5mb in the EU15 and Norway in
August. Distillate inventories posted a modest increase of 1.5mb, outweighed by a2.0mb counter
seasonaldrawingasoline.Meanwhile,refinedproductstocksheldinindependentstorageinNorthwest
EuropefellinAugust,ledbydrawsingasoilandgasoline.

OECD Pacific
Industry oil inventories in the OECD Pacific rose by 3.8mb to 409mb in July. The monthly build was
weakerthanthetypical9.3mbseasonalincreaseandwasledbygainsinotherproductsandcrudeoil,
withmodestdeclinesinotherproductcategories.
mb

OECD Pacific Crude Oil Stocks

mb

190

90

180

80

170

70

160

60

150
Jan

Mar May
Jul
Range 2006-2010
2010

13S EPTEMBER 2011

Sep Nov
Jan
Avg 2006-2010
2011

50
Jan

OECD Pacific Middle Distillates

Stocks

Mar
May
Jul
Range 2006-2010
2010

Sep
Nov
Jan
Avg 2006-2010
2011

31

OECD S TOCKS

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Industrycrudeoilinventoriesincreasedby1.8mb,whileproductinventoriesgained4.3mb,asabuildin
otherproductsoutweighedmodestdrawsingasoline,distillatesandfueloil.Yet,theregionalindustry
stockbuildislikelysupportedby3.5mbofpublicoilreservesloanedtoindustryinKorea(seeIEALibya
CollectiveAction:OilfromGovernmentStocksRelievingtheMarket).

mb
16

Japan Weekly Gasoil/Diesel Stocks

mb
35

Japan Weekly Kerosene Stocks

30
14

25
20

12

15
10

10
Source: PAJ

8
Jan

Source: PAJ

Apr
Jul
Range 2006-10
2010

Oct
5-yr Average
2011

5
Jan

Apr
Jul
Range 2006-10
2010

Oct
5-yr Average
2011

Weekly data from the Petroleum Association of Japan (PAJ) point to a 3.4mb draw in Japanese
commercialoilinventoriesinAugust.Increasesinrefinerythroughputsdrovecrudeoilstockslowerby
10.5mb, while, product stocks rose by 6.0mb driven by kerosene and gasoil restocking. Before the
MarchearthquakeJapanesekeroseneinventorieswereonadecliningtrend.However,stockshaverisen
sharplysinceMarch,asbothdomesticrefineryrunshaverecoveredandimportsfromelsewhereinAsia
havearrived.

Recent Developments in China and Singapore Stocks

AccordingtoChinaOil,GasandPetrochemicals(ChinaOGP),Chinesecommercialoilinventoriesdeclined
by an equivalent of 0.8mb (data are reported in terms of percentage stock change), to just below
351mb in July. Crude oil stocks gained 3.3% (6.9mb) as crude imports remained elevated at the time
when several refiners reduced runs due to maintenance. As a result, product stocks contracted by
around7.7mb,ledbya5.4%(4.1mb)drawingasoil.Gasolineinventoriesdroppedby5.0%(2.7mb)and
kerosenefellby7.6%(0.9mb).

mb
20

China Monthly Oil Stock Change*

mb

15
10
5
0
(5)
(10)
(15)
Jan 11

Mar 11

Crude

Gasoline

May 11
Gasoil

Jul 11
Kerosene

*Since August 2010, COGP only reports percentage stock change

Singapore Weekly Middle Distillate

Stocks

18
16
14
12
10
8
6
4 Source: Int ernat ional Enterprise
Jan
Apr
Jul
Range 2006-2010
2010

Oct
5-yr Average
2011

Refined oil product stocks in Singapore rose by 0.2mb in August, as a gain in fuel oil inventories
outweighed drawsinlightand middledistillates.Fueloilstocksroseby1.7mbfollowingthearrivalof
severalshipmentsattheendofthemonth.Meanwhile,gasolineandmiddledistillatestocksdeclinedby
1.0mb and 0.5mb, respectively, led by lower imports following an outage at Formosas refinery in
Taiwan.Atthesametime,regionaldemandwasstrongandproductexportstoVietnamincreasedduring
seasonalmaintenanceatthecountryssolerefinery.

32

13S EPTMEBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

OECD S TOCKS

Regional OECD End-of-Month Industry Stocks

(in days of forward demand and millions barrels of total oil)
Days1
Days

Million Barrels

60

mb
1,450

58

1,400

56

1,350

North America

54

North America

1,300

52

1,250

50

1,200

48
Jan

Mar

May

Jul

Range 2006-2010
2010

Days
72

Sep

Nov

Jan

Jan

Mar

May

Jul

Range 2006-2010
2010

Avg 2006-2010
2011

mb
1,020

Europe

70

Sep

Nov

Jan

Avg 2006-2010
2011

Europe

1,000

68

980

66

960

64
62

940

60

920

58

900

Jan

Mar

May

Jul

Range 2006-2010
2010

Days
58

Sep

Nov

Jan

Mar

May

Jul

Range 2006-2010
2010

mb
480

Pacific

56
54

Sep

Nov

Jan

Avg 2006-2010
2011

Pacific

460
440

52

420

50

400

48
46

380

44
Jan

Jan

Avg 2006-2010
2011

360
Mar

May

Jul

Range 2006-2010
2010

Days
62

Sep

Nov

Jan

Jan

Avg 2006-2010
2011

Mar

May

Jul

Range 2006-2010
2010

mb
2,800

OECD Total Oil

60

Sep

Nov

Jan

Avg 2006-2010
2011

OECD Total Oil

2,750

58

2,700

56
2,650

54

2,600

52

2,550

50
Jan

Mar

May

Range 2006-2010
2010

Jul

Sep

Nov

Avg 2006-2010
2011

Jan

Jan

Mar

1 Days of forward demand are based on average demand over the next three months

13S EPTEMBER 2011

May

Range 2006-2010
2010

Jul

Sep

Nov

Jan

Avg 2006-2010
2011

33

P RICES

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

PRICES
Summary
Uncertainglobaleconomicandfinancialmarketprospectsunderpinnedvolatileoilfuturespricesin
August and early September. After plunging in tandem with the large selloff in financial and
commodity markets in early August, WTI and Brent futures partially retraced their losses on tighter
AsianandEuropeanmarkets.Pricesatwritingwere$111/bblforBrentand$86/bblforWTI.

Spot crude oil prices tracked the downturn in futures markets, with benchmark grades in August
lowermonthonmonth.Bymidmonth,however,physicalmarketswerestrengtheningontheback
ofrobustdemandfromrefiners,especiallyinAsia,andonsupplyoutagesintheNorthSea,USGulfof
MexicoandChina.

ThelightendoftheproductbarrelcontinuedtoshowstrengthinAugust,whereasmiddledistillate
markets weakened throughout the month. In late August, Hurricane Irene propped up product
prices.However,movingintoSeptember,productcrackspreadsfellastheriseincrudepricesmore
thanoutpacedthoseforproductsandasadisappointingUSdrivingseasoncametoanend.

Refining margins strengthened monthonmonth in most benchmark regions in August. One

exception was the US Gulf Coast, where margins showed diverging trends. EarlySeptember saw
marginsfallinginallregionsagain,asproductpriceslaggedbehindresurgentcrude.

FreightratesremainedinmalaisethroughoutAugust,withearningsonallbenchmarkroutesclose
toorbelowbreakevenlevels.Inthecrudetankermarket,datasuggestthatglobaloilintransithas
fallen steadily from its June peak. As such, rates on the benchmark VLCC Middle East Gulf Japan
route remained anchored at close to $10/mt, which, when combined with persistently high bunker
fuelcosts,translatesintonegativeearnings.

$/bbl

Crude Futures
Front Month Close

130

115

120

110

110

105

100

100

9Sept2011

95

90

90

80

85

Source: ICE, NYMEX

70
Aug 10

NYMEX WTI & ICE Brent

Forward Price Curves

$/bbl

Source: ICE, NYMEX

80
Nov 10

Feb 11

NYMEX WTI

May 11

Aug 11

ICE Brent

M1 2

NYMEX WTI

9 10 11 12
ICE Brent

Market Overview
Precarious global economic and financial market prospects underpinned volatile oil futures prices in
AugustandearlySeptember.AfterplungingintandemwiththelargeselloffinmarketsinearlyAugust,
WTIandBrentfutures pricespartially retracedtheirlossesondisruptionsto suppliesintheNorthSea
stemmingfromoperationalproblems,weatherrelatedclosuresintheUSGulfofMexico,technicalissues
atfieldsinChinasoffshoreBohaiBay,andsabotagetopipelinesinNigeriastroublesomeDeltaregion.
Prices were also supported by stronger Asian and European demand as refineries reentered service
afterturnarounds.

34

13 S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

P RICES

Benchmark futures prices on average ended lower in August, with WTI down by around $11/bbl to
$86.34/bblandBrentoffbyasmaller$6.83/bblto$109.93/bbl.Brentthenreclaimedafourweekhigh
ofaround$115.80/bblon6September,beforeretracinggainstoaround$111/bblatwriting.WTIwas
pressuredlowerbyaweakerthanexpectedjobsreportinearlySeptemberbutanotherwaveofstormy
weatherintheUSGulfofMexico,whichforcedtheprecautionaryshutinofoilplatforms,brieflyadded
upwardpressurebeforepriceseasedagain,withWTIlasthoveringaround$86/bbl.

TheWTIandBrentmarketscontinuedondivergentpathsinAugust,withthepricespreadbetweenthe
twohittingrecordlevelsofover$27/bblinearlySeptember.WTIremainsunderpressurefromrelatively
highUScrudestocks,especiallyinthelandlockedUSmidcontinent.Thelatestrecordspread,however,
is in large part due to the continued shutin of Libyan crude, compounded by continued planned and
unplannedshutinsofNorthSeacrudesaswellasthemostrecentforcemajeureonNigerianBonnyLight
crude,whichhastightenedthemarketforBrentlinkedgrades.

Crude Futures
Forward Spreads

$/bbl
8

$/bbl Forward Price Spread (M1-M36)

16
12
8
4
0
-4
-8
-12
Source: ICE, NYMEX
-16

4
0
-4
-8
-12
Source: ICE, NYMEX

-16
Aug 10

Nov 10
Feb 11 May 11
Aug 11
WTI M1-M12
Brent M1-M12

Aug 10

Nov 10
Feb 11
Brent

May 11
WTI

Aug 11

The12monthforwardpricestripforWTIishoveringinarelativelynarrowrangearound$90/bbl.The
WTI M1M12 contract was largely unchanged in August at $4.20/bbl (contango) compared with an
average$4.35/bblinJulybutnarrowedagaininearlySeptemberto$2.65/bbl.TheM1M36contract
widenedtoanaverage$7.30/bblinAugust,comparedwithanaverage$5.50/bblinJulyand$3.35/bbl
inJune.However,afterpeakinginearlyAugust,contangonarrowedagainoverthecourseofthemonth,
which in part reflects growing market expectations that the economic slowdown will be protracted,
furtherunderminingglobaloildemandforthenextfewyears.

Bycontrast,theBrentM1M12backwardationdeepenedtoaround$4/bblinearlySeptembercompared
with$1.55/bblinAugust, and$0.80/bblinJuly.The longerdatedM1M36forBrentcontractalsosaw
backwardation widen to over $10/bbl in early September, compared with an average $6.65/bbl in
August,$6.20/bblinJulyand$8.05/bblinJune.

NYMEX WTI vs S&P 500

US$/bbl
120

US$/bbl
120

Index
1500

110

NYMEX WTI vs US Dollar Index

So urce: ICE, NYM EX

110

1400

75

100

100

1300

90

90
1200

80
70

Index
70

80

80

1100

70

1000

60
Jan 10

85

So urce: NYM EX

60
Jan 10

Jul 10

NYM EX WTI

Jan 11

Jul 11
S&P 500 (RHS)

90
Jul 10

Jan 11

Jul 11

NYM EX WTI
US Dollar Index (inversed RHS)

Thepotentialforweakeroildemandistemperingpricemovestotheupside.Oilpriceshavebeenheld
hostagetoalmostdailynegativeeconomicandfinancialmarketreports,withheightenedconcernsover

13 S EPTEMBER 2011

35

P RICES

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

European and US debt issues and fears of a doubledip recession prompting a downgrade in GDP
expectationsforthisyearand2012.Inresponse,thisreporthasloweredforecastglobaloildemandby
0.2mb/dfor2011andby0.4mb/dfor2012.

Supplywoesmayyetkeepafloorunderpricesheadingintothe4Q11winterdemandperiodhowever.
OPEC crude oil output in August was up by 165kb/d, to 30.26mb/d, but despite the groups higher
outputlevels,productionisstill1.04mb/dbelowthe31.3mb/dcallonOPECcrudeandstockchange
expected for 3Q11. The supply gap is becoming increasingly apparent in reported stock holdings, with
totalOECDcommercialoilstocksfallingbelowthefiveyearaverageforthefirsttimesincetherecession.

OPECsparecapacity,akeysupplybarometerformarketwatchers,currentlyisestimatedatarelatively
low 3.24mb/d, largely due to other producers having raised output amid the continued absence of
Libyan production from the markets. The fall of Tripoli to rebel forces on 21 August raised hopes of a
quickendtothecountryssixmonthconflictandtheprospectsforpartialrestorationofLibyancrudeoil
supplies, which initially added downward pressure on prices. The price impact was negated as a more
cautious consensus emerged on the timeline and scale for the restoration of the countrys crude
production(seeSupply,ShortTermOilSupplyProspectsinLibyaasEndgameNears).

Indeed, the continued loss of light, sweet Libyan crude, $/bbl

Sweet-Sour Differentials
coupledwiththeshutinofNorthSeagradesandgasoline 16
rich Nigerian Bonny Light, led to a further widening of 14
12
sweetandsourpricespreadsinEuropeandAsia,withthe 10
TapisDubai differential widening to $13.40/bbl in early
8
6
September compared with around $11.30/bbl in July and
4
$10.90/bblinJune.
2

0
Data source: Platts analysis
In contrast to the more acute loss of light, sweet Libyan -2
crude, sanctions imposed by the US and EU on Syrian
Aug 10
Nov 10
Feb 11 May 11
Aug 11
DB - Urals Med
Tapis - Dubai
crudeandoilproductsimportsareexpectedtohavescant
impact on global markets, given the limited export
volumesofaround125150kb/d.Moreover,othercountriesnotboundbysanctions,suchasChinaand
India,arefreetolifttheSyriancrude(seeSupplysection,NewEUSanctionsonSyriaUnlikelytoAffect
SyrianCrudeOilProduction).

Prompt Month Oil Futures Prices

(monthly and weekly averages, $/bbl)

Jun
NYMEX
Light Sweet Crude Oil
96.29
RBOB
123.93
No.2 Heating Oil
125.04
No.2 Heating Oil ($/mmbtu)
21.47
Henry Hub Natural Gas ($/mmbtu)
4.52
ICE
Brent
113.90
Gasoil
127.24
Prompt Month Differentials
NYMEX WTI - ICE Brent
-17.61
NYMEX No.2 Heating Oil - WTI
28.75
NYMEX RBOB - WTI
27.64
NYMEX 3-2-1 Crack (RBOB)
28.01
NYMEX No.2 - Natural Gas ($/mmbtu 16.95
ICE Gasoil - ICE Brent
13.33
Source: ICE, NYMEX

36

Jul

97.34
130.16
129.25
22.19
4.35

Aug

Aug-Jul
% Week Commencing:
Avg Chg Chg 08 Aug 15 Aug 22 Aug 29 Aug 05 Sep

86.34 -11.00
120.53 -9.63
123.92 -5.33
21.27 -0.91
3.98 -0.37

116.75 109.93
130.22 125.27

-6.83
-4.95

-19.41
31.91
32.82
32.52
17.84
13.47

-4.17
5.67
1.37
2.80
-0.54
1.88

-23.59
37.58
34.19
35.32
17.29
15.35

-12.7
-8.0
-4.3
-4.3
-9.3

82.92
115.85
119.57
20.53
4.02

85.35
85.08
119.47 121.74
122.79 124.40
21.08
21.36
3.94
3.93

88.07 88.14
123.20 120.62
127.74 127.82
21.93 21.94
3.95
3.95

-6.2
-3.9

105.81
120.99

109.12 109.96
123.98 125.40

113.47 113.33
129.64 128.13

-22.89
36.65
32.93
34.17
16.51
15.18

-23.77
37.44
34.12
35.23
17.14
14.86

-25.40
39.67
35.13
36.64
17.98
16.17

-24.88
39.32
36.66
37.55
17.42
15.44

-25.19
39.68
32.48
34.88
17.99
14.80

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Futures Markets
OpeninterestinWTIcontractsonNewYorkandLondonICEExchangesshowedconsiderablefluctuations
in August. After reaching a fourmonth peak in the week ending 9 August, open interest in New York
declinedinfuturesonlycontractsfrom1.56millionto1.52millioncontracts.Meanwhile,openinterest
in futures and options contracts declined by 7.64% to 2.78 million contracts. During the same period,
open interest in London ICE WTI contracts increased in futuresonly contracts to 0.46million and
declinedincombinedcontractsto0.51million.

ProducersdecreasedtheirnetshortpositionduringthemonthofAugust;theyheld27.29%oftheshort
and15.37%ofthelongcontractsinCMEWTIfuturesonlycontracts.Swapdealers,whoaccountedfor
32.3%and31.9%oftheopeninterestonthelongsideandshortside,respectively,decreasedtheirnet
longpositionby13115contracts.Inthemeantime,bothproducersandswapdealersreducedtheirnet
shortpositionsinLondonICEWTIfuturescontract.
'000
Contracts

Net Positions in WTI Futures

'000
Contracts

$/bbl

Source: CFTC, NYMEX

300
100
100

NYMEX WTI Mth1

$/bbl

Open Interest

1,600

120

1,500

100

1,400

95

-100

80

1,300
60

1,200

-300

90
07 Jun
21 Jun
05 Jul
Producers
Money Managers
Non-Reportables

19 Jul
02 Aug
Swap Dealers
Other Reportables
NYMEX WTI

40

1,100

Source: CFTC, NYM EX

1,000
20
Jan 09 Jul 09 Jan 10 Jul 10 Jan 11 Jul 11
Open Interest

NYM EX WTI M th1

Managedmoneytradersdecreasedtheirbetsonrisingcrudeoilpricestoaninemonthlowintheweek
ending 23 August as a response to renewed fears of another recession in the US and concerns over
sovereign debt in Europe. However, they increased their bullish bets in the last week of August from
138771 to 155 728 contracts and from 21 287 to 21 512 contracts, in New York and in London,
respectively, in response to the increase in WTI prices from $85.44/bbl to $88.90/bbl. This bullish
attitude was subsequently reversed in the week ending 6 September, as managed money traders cut
their bets in New York and London. Similarly, money managers decreased their Brent futures net long
positionby58%from91994to38646contractsbetween2Augustand23August,2011.However,they
increasedtheirnetlongexposureby30881contractsfrom23Augustto6September.

NYMEXRBOBfuturesandcombinedopeninterestincreasedbymorethan3.9%inAugust.Openinterest
inNYMEXheatingoilincreasedby1.83%to312753contractswhileopeninterestinnaturalgasmarkets
declinedby0.32%to977952contracts.Indexinvestorsincreasedtheirlongexposureincommoditiesin
July2011.However,theywithdrew$1.3billionfromtheWTILightSweetCrudeOilmarketinJuly2011,
whichfellfromanalltimehighof694000futuresequivalentcontractsinMarchto673000contracts,
equivalentto$65.1billioninnotionalvalue.
Positions on NYMEX Light Sweet Crude Oil (WTI) Futures Contracts
Thousand Contracts
06 September 2011

Producers' Positions
Swap Dealers' Positions
Money Managers' Positions
Others' Positions
Non-Reportable Positions
Open Interest
Source: CFTC

13 S EPTEMBER 2011

Long

Short

234.3
231.7
224.2
113.8
71.8

415.9
224.9
70.1
102.8
62.1

Net

Long/Short

-181.6
6.8
154.1
11.0
9.7
1523.9

Short
Long
Long
Long
Long

Net from Prev.

Net Vs Last

Week

Month

-4.7
-8.3
-1.6
14.1
0.6
29.1

3.8
-13.1
7.0
22.4
-20.1
-40.6

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Commodity Index Traders -- The New Whipping Boys?

An August CFTC conference in Washington DC was organised to highlight and discuss recent academic
research on key issues affecting commodity markets. The conference came at a time of intense debate
surroundingrecentCFTCrulemaking.Severalconferencepanelistsarguedthatspeculatorsingeneral,and
commodity index traders (CITs) in particular, have affected the functioning of commodity markets and
caused oil price swings that cannot be explained by energy market fundamentals especially during the
2008 financial crisis. However, in the presentations of that set of papers, we failed to see any detailed
accounting for those very fundamentals. In contrast, the few papers at the conference that focused on
fundamentalsfoundnoclearcutevidenceofspeculatorsdrivingpricesawayfromtheirfundamentalvalues.
Perhaps one of the most discussed papers in the followup press coverage was delivered by Stanford
Universitys Kenneth Singleton. It is worth noting here that Professor Singletons paper, which has been
seized upon by supporters of limits on speculative commodity positions, started as a survey that he
conductedfortheAirTransportAssociationofAmerica(ATA).Forthisreasonandbecausethepaperhas
received wide publicity, it is worth discussing some of the papers limitations and methodological
shortcomingswhichitsauthorhimselfhasacknowledged.
Professor Singletons paper comprises two parts a formal model of how speculation could, in theory,
temporarily drive commodity prices away from their fundamental value, and an empirical analysis. The
theory part assumes that investors are a heterogeneous bunch. Those market participants, including
speculators, try to anticipate their competitors move given imperfect information on economic
fundamentals and on speculative activity. Their decisions are therefore sometimes affected by other
participants behaviour (herding); that is to say, investors sometimes mimic their competitors moves.
Investorsmightalsohavedifferentopinionsaboutthefuturecourseofeconomicfundamentals.Although
theseinvestorsmightbeusingcommonknowledge,theirinterpretationofcommoninformationmightbe
different,whichleadstohighertradingvolumesandcomovementsamongdifferentassetclasses.Thishas
the effect of moving prices away from their fundamental values, inducing higher volatility and generating
boomsandbustsinprices.
Methodology Questions Abound
ProfessorSingletonnextseekstoprovideempiricalevidenceforhisanalysis.Forhisempiricalwork,heuses
CITpositionsimputedonthebasisofinvestmentadvisorMichaelMastersmethodology.Thisextrapolation
method has significant problems. First, the imputation is based on CFTC Supplemental Commitments of
Traders(SCOT)report,whichdoesnotcontainanydataforcrudeoil.ToestimatecrudeoilCITpositions,one
mustthereforeusedatafrom12agriculturalmarketsforwhichtheCFTCgathersCITpositioninformation,
and then make a number of unlikely assumptions about the relationship between CIT positions in
agriculturalandenergymarkets.Second,theSCOTdatasetitselfisproblematicwhenmeasuringCITsactivity
evenforthe12agriculturalcommodities.ThisisbecausetheSCOT,whichinitiallyidentified32(now43)
CITs, classifies all the positions of a trader engaged in commodity index trading as commodity index
investmentregardlessofthetradersactualtradingstrategy.Therefore,ashasbeenpointedoutbythe
CFTCitself,thepublishedaggregatefuturespositionintheCOTSupplementalmayoverstateorunderstate
theactualamountofindextrading(overstateittotheextentthepositionsreflectothertradingstrategies,
andunderstateittotheextentthatindexpositionsareinternallynettedagainstnonindexpositionsbefore
thenetpositionisbroughttothefuturesmarkets).
As was pointed out in another paper presented at the CFTC conference by the University of Illinois Scott
Irwin, the imputation methodology employed by Professor Singleton can lead not merely to some
measurementerrorsbuttohugemeasurementerrors:
Thenettingeffectmightnotbeimportantforagriculturalcommoditieswheretheswapdealersfutures
positions are generally limited to long futures hedges offsetting their short OTC exposure to those
pensionfundsorotherindexbasedtraders.However,thenettingeffectmightbeveryimportantwhere
manyswapdealers(asisthecaseinenergyproducts),inadditiontotheircommodityindexrelatedOTC
activity, enter into other OTC derivative transactions in individual commodities, both with commercial
firmshedgingpriceriskandwithspeculatorstakingonpricerisk.

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Commodity Index Traders -- The New Whipping Boys? (continued)

ProfessorIrwinandhiscoauthorDwightSandersshowthattheleveloferrorsisquitelarge.Comparing
theimputedpositionwithIndexInvestmentData(IID)providesaglimpseoftheextentofmeasurement
errors(52%meanabsoluteerrors).The measurementerroratsome pointleadstoacategorisationof
some 7075% of long positions as index investments, implying that not only all swap dealers long
positionsbutalsomanagedmoneytraderspositionsarecategorisedascommodityindextrading.Thisis
not possible: the CFTCs own Special Call data indicates that at most 1520% of index investment is
carriedoutbymoneymanagers.
WhilesomeoftheotherpaperspresentedattheCFTCconferenceproposedlessimprecisealternativesto
estimate CIT activity in commodity futures markets, they all relied on time series that the CFTC does not
make public. If anything, the data difficulties faced by Professor Singleton and others in proxying for CIT
activitypointstotheneedfortheCFTCtoreleasemoredisaggregatedpositioninformation.Forexample,
there is evidence that the long positions of commodity swap dealers in nearmaturity contractsprovide a
reasonableproxyforcommodityindexinvestment.Clearly,publiclyavailablepositiondatadisaggregatedby
maturitywouldhelpunderpinmoredetailedanalysisinthissphere.
Finally,theinterpretationofProfessorSingletonsestimationresultsalsopresentssomedifficulties.
First,toestimaterealisedexcessreturnsincrudeoilpricesusingweeklydatafrom12September2006to
12January 2010, the paper uses the change in the long positions of commodity index funds and money
managersaswellassomefinancialvariables(suchasthechangeinrepopositionsonTreasurybondsand
laggedreturnsonemergingmarketequitypositionsasexplanatoryvariables).Asanotherpaperpresented
at the conference by the University of Californias Professor James Hamilton showed, energy market
fundamentals are crucial to understanding crude oil prices. Professor Singletons estimation procedure,
however,doesnotdirectlyaccountforoilmarketfundamentalssuchasdemandgrowthinemergingmarket
economies(especiallyinChina),inventoriesoutsideoftheOECD,orrisingcostsofproduction.Furthermore,
aswehavearguedinpreviousissuesoftheOMR,bothexcessreturnsandcommodityindexflowsmightbe
responding to some common shocks (such as expectation of higher growth in China and other emerging
countries).Thepointestimatesintheregressionsmightthusbebiasedduetothisendogeneityproblem.
Significance: Economic versus Statistical
Second,thepapershouldprovidedescriptivestatisticsonthevariablessothatonecanassesstheimpactof
a change in index investment on realised returns. Professor Singletons paper argues that it presents
evidence of an economically and statistically significant effect of investor flows on futures prices, after
controlling for returns in US and emergingeconomy stock markets, the futures/spot basis, and lagged
returnsonoilfutures.Theindexinvestmentcoefficientisstatisticallysignificant,althoughitisdifficultto
assesstheeconomicsignificanceofcommodityindexinvestmentonrealisedreturn,giventheinformation
providedonthepaper.
Finally, as suggested by the University of Houstons Craig Pirrong in his blog, suppose that Professor
Singletons findings do indicate that excess returns on crude oil futures are predictable, conditional on
measures of speculative activity. Nonetheless, such a predictability of returns would not imply that
speculation has distorted prices. Rather, predictability is the result of market frictions that might create
hedging demand, leading to an increase in the risk premium. Professor Pirrong suggests that, in such
circumstances,speculativepositionscanpredictchangesinfuturesprices.Topreventthepredictabilityof
returns, it might be advisable to reduce constraints on the flow of speculative investment to commodity
markets,ratherthanlimitingthem.

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Spot Crude Oil Prices

Spot crude oil prices retraced early August losses posted in the wake of the financial and commodity
marketselloff,withphysicalmarketsstrengtheningonthebackofsupplyoutages.Averagespotprices
for benchmark grades in August closed lower monthonmonth but by early September were trading
nearJulysloftierlevels.USWTIpostedthelargestdecline,down11.3%whilelightMalaysianTapiswas
offjust3.7%.

IntheUS,mountingconcernsaboutthefalteringeconomy,thearrivalofSPRbarrelsintothekeyUSGulf
coast refining region and crude stocks well above the fiveyear average in the key Midcontinent region
continued to weigh on benchmark WTI. Spot prices posted a large decline in August, down by nearly
$11/bbl,toanaverage$86.30/bbl.Spotmarketsstrengthenedagainfrommidmonthandby8September,
WTIhadrecoveredto$87.70/bbl,inpartduetosupplydisruptionscausedbyHurricaneIrene.
$/bbl
130

Benchmark Crude Prices

$/bbl

WTI vs Dated Brent Differential

120

110

-5
-10

100

-15

90

-20

80

-25

Data source: Platts analysis

-30

70
Aug 10
Nov 10
WTI Cushing

Feb 11
May 11
Dated Brent

Aug 11
Dubai

Data source: Platts analysis

-35

Aug 10

Nov 10

Feb 11

May 11

Aug 11

ContinueddelayswithmaintenanceworkcurtailedoutputofNorthSeacrudeinAugust,whichhelped
stem the price decline last month of Dated Brent, down by around $6.50/bbl to $110.35/bbl. Prices
resumed their upward trajectory in midAugust and were around $113.60/bbl on average through
9September.

Scheduled maintenance work and operational problems in the North Sea, including its largest field,
Buzzard,havecurtailedthesupplyofFortiescrudeformorethanfourmonthsnow.FortiesBlend,which
includesoutputfromtheBuzzardfield,isakeycrudeusedforsettingtheDatedBrentprice.Thelossof
FortiesoutputpusheddifferentialstootherNorthSeagradestothehighestinmorethanthreeyearsat
endAugust,whereasheavierFortiesnormallytradesatadiscounttootherlocalgrades.

3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.5
-1.0

Non-OPEC Supply 2011

Selected Shut-ins & Adjustments

Data source: Platts analysis

Aug 10

kb/d

North Sea Crude

Differentials to Dated Brent

$/bbl

-200
-400
-600
-800
1Q

Nov 10
Feb 11
Statfjord
Oseberg

May 11
Aug 11
Ekofisk
Forties

2Q

North Sea maintenance

UK Buzzard and other outages
Argentina protests/damage
Malaysia Kikeh outages
Yemen outages

3Q

4Q

US hurricane adjustment
Norw ay other outages
Canada Horizon fire
Sudan outages

The prolonged outages of North Sea supplies, coupled with the continued loss of Libyan crudes in the
Mediterranean,hashadawiderangingimpactnotonlyinEuropeanmarketsbutalsoonUSandAsian
tradeflows.Europeanmarkets,alreadytightduetotheshutinoflight,sweetLibyancrude,areshunning
regionalcrudeslinkedtohighpricedBrentand,buyingcheaperMiddleEastcrudessuchasOmanand
IraqiBasrahLight.

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Meanwhile, Brents premium over WTI continued to breach record levels. WTI traded at an average
$24.07/bbldiscounttoBrentinAugustcomparedtoanaverage$19.62/bblinJuly.Bytheendofthefirst
weekofSeptember,thespreadhadwidenedtomorethan$27/bbl.

InAsia,BrentsrelativestrengthalsodistortedpricingrelationshipswithMiddleEastandAfricancrudes.
The price spread between Dated Brent and Dubai narrowed over the month on stronger demand for
relativelycheaperMiddle Eastern crudescomparedtoBrentlinkedAfricangrades.Dubaisdiscountto
DatedBrent averaged$5.35/bblinAugustcomparedwithadeeper$6.89/bblinJuly.TheBrent/Dubai
spread, however, was temporarily distorted by the more general plunge in commodity prices in early
August.TheviolentdownwardmoveshookoutspeculativelengthinBrentcontractswhilethephysical
marketintheEastforDubaiduringthepriceselloffwastight,sotheshockabsorberintheequationwas
theBrent/Dubaispread.
$/bbl
$/bbl
15

Brent vs. Dubai

EFS & Physical

2
0
-2
-4

10
5

-6
-8
-10
-12

0
-5
Data source: Platts analysis

-10
Aug 10

Middle Eastern Crude Prices

vs. Dated Brent

Nov 10
Feb 11 May 11
Aug 11
ICE Brent M1 - Dubai Swaps M1
Dated Brent - Dubai Mth1

Data source: Platts anlaysis

-14
Aug 10

Nov 10
Feb 11
Oman-DB

May 11
Aug 11
Dubai-DB

Demand for Mideast crudes is also on the rise ahead of the upcoming seasonal shift in focus to
distillaterich grades. A number of Middle East producers have raised their official selling prices for
October, in part due to more robust refining margins. Saudi Aramco raised price differentials for all
grades to Asia and Europe while lowering them for US customers. In Asia, prices for Arab Light were
raisedby$0.90/bblwhile ArabHeavyroseby$1.15/bbl,inline withstrongerfueloilcrackspreads.In
Europe,ArabExtraLightandArabLightpostedthe largestincreases,asexpected,givenstrongrefiner
demand for light crudes to replace Libyan barrels. Price differentials for the wellsupplied US market
werecutby$0.15/bblto$0.25/bbl.

Spot Crude Oil Prices and Differentials

Table Unavailable
Available in the subscription version.
To subscribe, visit: http://www.iea.org/w/omrss/default.aspx

13 S EPTEMBER 2011

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Spot Product Prices

The light end of the barrel continued to show strength in August, whereas middle distillate markets
weakenedthroughoutthemonth.Thebottomofthebarrelremainedrelativelystrong,butinAugustlost
some support. In late August, Hurricane Irene, together with inventory draws, propped up product
prices. However, moving into September product crack spreads weakened as the rise in crude prices
morethanoutpacedthoseforproductsandadisappointingUSdrivingseasoncametoanend.Ahigher
thanexpectedbuildininventoriesalsoaddeddownwardpressure.

GasolinecrackspreadsimprovedmonthonmonthinEurope,AsiaandtheUSEastCoast,whereasthey
weakenedontheUSGulfCoast.TheUSGulfCoastcrackspreadsforMarsfellfromastrong$15.80/bbl
in July to $12.55/bbl in August, while LLS was down a lesser $1.15/bbl, to $10.57/bbl, as falling light
sweet premiums helped limit losses. Cracks fell in early August due to a largerthanexpected build in
stocks combined with low US demand. However, they improved towards monthend due to reduced
stocklevelsaswellasfearofpossibleshortagesduetoHurricaneIrene,beforeweakeningagaininearly
Septemberontherelativestrengthofcrudemarkets.
$/bbl

Gasoline
Cracks to Benchmark Crude s

38
34
30
26
22
18
14
10
6
2
-2

$/bbl
45
40
35
30
25
20
15
10
5

Data source: Platts analysis

Feb Mar Apr May

NWE Unl 10ppm
Med Unl 10ppm

Jun

Jul Aug
USGC
SP

Gasoil/Heating Oil
Cracks to Benchmark Crudes
Data source: Platts analysis

Feb Mar Apr May

NWE Gasoil 0.1%
Med Gasoil 0.1%

Sep

Jun

Jul Aug Sep

NYH No. 2
SP Gasoil 0.5%

InEurope,gasolinemarketswererelativelytight,andcrackspreadsincreasedslightlymonthonmonth;
upby$1.18/bblinNorthwestEuropeand$0.90/bblintheMediterranean.Lowstocklevelsandstrong
regionaldemandaswellasanopenarbitragetoallmainmarketstightenedsuppliesatthebeginningof
themonth,andHurricaneIrenesupportedcrackspreadstowardsmonthend.

Middle distillate crack spreads improved monthonmonth in Europe and the US East Coast, and fell
slightly in Asia. At the US Gulf Coast, LLS crack spreads improved, whereas the Mars spreads fell. The
Europeanmarketwasalsotightasstocklevelsfortheseproductswerelowanddemandwasstrong,but
an open arbitrage from both the US and Asia pressured cracks lower towards monthend. In Asia,
sentimentwasinfluencedbyfearofoversupplywiththegradualrestartoftheMailiaorefineryinTaiwan
aswellasincreasedexportsfromJapan.
$/bbl
8
4
0
-4
-8
-12
-16
-20

$/bbl

Low-Sulphur Fuel Oil (1%)

Cracks to Benchmark Crudes

High-Sulphur Fuel Oil

Cracks to Benchmark Crudes

0
-4
-8
-12
-16
-20

Data source: Platts analysis

Data source: Platts analysis

-24
Feb Mar Apr May
NWE LSFO 1%
SP LSWR

Jun

Jul Aug Sep

Med LSFO 1%

Feb Mar Apr May

NWE HSFO 3.5%
SP HSFO 380 4%

Jun

Jul Aug Sep

Med HSFO 3.5%

LSFOdiscountswidenedmonthonmonthinEuropeaspeaksummerdemandpassed,andfueloilprices
struggled to follow the increases in the crude price. Although weakening, cracks were still in positive

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P RICES

territory in Asia. On the other hand, HSFO discounts narrowed monthonmonth in all regions, with
strong Asian bunker fuel oil demand, less exports from the Middle East and refining maintenance
tighteningthemarketinthebeginningofthemonth.ThroughoutAugust,discountswidenedhowever,
withincreasingstocklevelspressuringEuropeanmarketsandincreasedrefineryrunsweightingonthe
Asianmarkets.

Spot Product Prices

Table Unavailable
Available in the subscription version.
To subscribe, visit: http://www.iea.org/w/omrss/default.aspx

Refining Margins
Refining margins strengthened monthonmonth in most benchmark regions in August with the
exception of the US Gulf Coast, where margins showed diverging trends, and Daqing hydroskimming
margins in China, which dropped in the second half of August. Early September saw margins falling
acrossallregionsasproductpriceslaggedbehindincreasingcrudeprices.
$/bbl
6
4
2
0
-2
-4
-6
-8
-10
-12

$/bbl

NWE Refining Margins

USGC Margins

15
10
5
0
-5
-10

Jan Feb Mar Apr May Jun Jul Aug Sep

Brent Cracking
Urals Cracking

Jan Feb Mar Apr May Jun Jul Aug Sep

Brent H'skimming
Urals H'skimming

13 S EPTEMBER 2011

Maya Coking
Mars Coking
Brent Cracking

LLS Cracking
Mars Cracking

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P RICES

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European refining margins were supported by both strong gasoline and middle distillates crack spreads.
Simplerefinerieshadsomesupportfromnarrowfueloildiscountsinthefirsthalfofthemonth,butthe
discountwidenedthroughoutAugust,depressingmarginsforsimplerefineriesbacktoalltoofamiliarweak
levels,withlosseswideningtoabove$7/bblforUralshydroskimmingmarginsintheMediterranean.

The picture was mixed on the US Gulf Coast. Brent and LLS margins improved as did those for Maya,
whereasmarginsforBonnyLightandMarsfell.Marginsimprovedonincreasinggasolinecrackspreads,
while LLS and Brent margins benefited from falling light, sweet premiums. This is in contrast to Mars
margins, which were pressured by more expensive feedstock. In Singapore, refining margins
strengthened in August based on high readings at the start of the month, but then weakened as the
monthprogressed.ThemainfactorspressuringmarginswereawideningfueloildiscountinAugustand
stronger Tapis. Chinese margins improved in August with the exception of Daqing hydroskimming, as
Daqing strengthened in August. Cracking margins were stable in August as gasoline crack spreads
remainedstrongduetohighdemandandreducedrefineryrunsintheregion.

On the US West Coast, refining margins all improved, especially Kern coking margins, which increased
their calculated profit to above $15/bbl on average in August. Margins were pushed higher as Kern
tradedatalargerdeficitthanusualinAugustandduetostronggasolinecrackspreads.
Selected Refining Margins in Major Refining Centres
($/bbl)

Monthly Average
Jun 11

Jul 11

Aug 11

-0.28
1.40

0.78
1.65

2.52
2.92

Change
Aug 11-Jul 11

Brent (Hydroskimming)

-3.39

-2.62

-0.99

Urals (Hydroskimming)

-5.21

-5.35

-3.80

Mediterranean

Es Sider (Cracking)
Urals (Cracking)
Es Sider (Hydroskimming)
Urals (Hydroskimming)

0.75
-0.32
-3.67
-7.37

1.97
0.84
-3.33
-7.03

2.55
2.05
-3.14
-5.64

US Gulf Coast

Bonny (Cracking)
Brent (Cracking)
LLS (Cracking)
Mars (Cracking)
Mars (Coking)
Maya (Coking)

-1.98
-4.12
2.59
2.19
4.59
5.23

0.91
-2.25
5.12
2.89
5.97
7.56

US West Coast

ANS (Cracking)
Kern (Cracking)
Oman (Cracking)
Kern (Coking)

-3.19
3.87
-0.92
10.87

Singapore

Dubai (Hydroskimming)
Tapis (Hydroskimming)
Dubai (Hydrocracking)
Tapis (Hydrocracking)

China

Cabinda (Hydroskimming)
Daqing (Hydroskimming)
Dubai (Hydroskimming)
Daqing (Hydrocracking)
Dubai (Hydrocracking)

NW Europe

Brent (Cracking)
Urals (Cracking)

1.73
1.27

Average for week ending:

12 Aug

19 Aug

26 Aug

02 Sep

09 Sep

3.56
3.59

2.12
2.37

1.82
2.53

1.51
2.68

0.44
1.68

1.64

0.12

-1.19

-1.63

-2.60

-3.73

1.55

-3.01

-4.13

-4.17

-4.75

-5.73

0.58
1.21
0.19
1.39

3.32
2.76
-2.14
-4.70

1.86
1.40
-3.60
-6.09

1.92
1.51
-3.84
-6.21

1.99
1.54
-4.54
-6.96

0.45
0.27
-5.75
-7.43

0.43
-1.29
5.44
1.91
4.13
8.47

-0.48
0.96
0.32
-0.98
-1.84
0.91

0.25
-1.13
4.99
2.20
4.26
7.80

0.54
-1.42
6.59
2.39
4.39
8.36

1.44
-0.68
8.39
3.16
5.82
10.52

-0.01
-2.25
4.55
0.45
3.11
9.49

-2.78
-5.74
-0.91
-4.72
-2.76
5.81

-2.70
6.67
0.09
11.58

1.30
11.89
2.05
15.12

4.00
5.23
1.96
3.54

-0.18
13.97
0.62
12.76

2.18
13.16
2.95
15.51

4.73
13.40
4.61
20.42

3.21
8.85
5.44
19.19

-2.67
3.26
2.95
11.92

-1.85
-9.26
0.92
-8.28

-1.17
-6.92
1.68
-6.70

0.37
-6.83
2.86
-6.30

1.53
0.09
1.18
0.40

0.81
-5.67
3.06
-5.36

0.81
-6.49
3.35
-5.79

0.17
-7.95
2.61
-7.18

-0.67
-9.23
2.33
-7.99

-1.17
-10.52
1.71
-9.40

-5.40
-2.36
-2.11
0.06
0.74

-2.75
-1.99
-1.29
-0.27
1.75

-1.77
-2.74
0.29
-0.22
3.03

0.98
-0.76
1.58
0.05
1.29

-0.12
-2.28
0.76
-0.34
3.26

-2.42
-2.94
0.75
-0.02
3.54

-3.09
-3.03
0.07
0.04
2.76

-4.76
-4.72
-0.78
-0.81
2.45

-4.51
-2.30
-1.24
1.31
1.88

For the purposes of this report, refining margins are calculated for various complexity configurations, each optimised for processing the specific crude in a specific refining centre on a 'fullcost' basis. Consequently, reported margins should be taken as an indication, or proxy, of changes in profitability for a given refining centre. No attempt is made to model or otherwise
comment upon the relative economics of specific refineries running individual crude slates and producing custom product sales, nor are these calculations intended to infer the marginal
values of crudes for pricing purposes.
*The China refinery margin calculation represents a model based on spot product import/export parity, and does not reflect internal pricing regulations.
Sources: IEA, Purvin & Gertz Inc.

44

13 S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

P RICES

End-User Product Prices in August

DuringAugust,averageenduserpricesforselected IEAcountries,inUSdollarsextax,sawamarginal
decrease in most survey nations, bar the steep increases seen in Japan and the UK. On the one hand,
transport fuels saw monthonmonth average price decreases of 0.28% and 0.04% for gasoline and
diesel, respectively. On the other hand, heating oil declined by a meagre 0.11% and LSFO fell by a
sizeable 3.35%. From an annual standpoint, yearonyear
End-User Product Prices
growth rates for all fuel prices range between gasoline
Monthly Changes in USD, ex-tax
6%
(37.8%)andLSFO(40.4%).
4%

2%
Onamonthonmonthbasis,gasoline,dieselandheating
0%
oil fell most sharply in Canada by 2.9%, 2.7% and 3.2%, -2%
respectively.ConcerningLSFOprices,thelargestmonthly -4%
declinewasreportedinFrancewherepricesfellbyahefty -6%
-0.11%
0.04%
-3.35%
0.28%
5.6%.Notably,pricesleaptinJapanduringtheperiod,bar
Gasoline
Diesel
Heat.Oil
LSFO
France
Germany
Italy
those for LSFO. Gasoline, diesel and heating oil prices in
Spain
Japan
Canada
Japan increased monthonmonth by 5.7%, 4.9% and
United States
United Kingdom
Average
4.5%,respectively.

Freight
FreightratesremainedinmalaisethroughoutAugust,withearningsonallbenchmarkroutescloseto,or
below, breakeven levels. In the crude tanker market, data suggest that global oil in transit has fallen
steadily from its June peak. As such, rates on the benchmark VLCC Middle East Gulf Japan route
remainedanchoredatcloseto$10/mt,which,whencombinedwithpersistentlyhighbunkerfuelcosts,
translate into negative earnings. Reports indicate that rates for Suezmax and Aframax did manage to
remaininpositiveterritory,althoughtheywerereportedlywellbelowacceptablelevelsforowners.

US$/m t
28

US$/m t
35

Daily Crude Tanker Rates

24

30

20

25

16

20

12

15

10

Daily Product Tanker Rates

4
0
Jan 10

Data so urce: P latts analysis

Jul 10

8 0 k t N S e a - N W E ur
V LC C M E G ulf - J a p

Jan 11

Jul 11

13 0 k t W A f r- US A C

0
Jan 10

Data so urce: P latts analysis

Jul 10
3 0 K C a rib - US A C
75K M EG-Jap

Jan 11

Jul 11
2 5 K UKC - US A C
3 0 K S E A s ia - J a p

Intheproducttankermarket,thesituationwasslightlybrighterwithratesgenerallyholdingtheirground
throughout August. The exception to this was the Caribbean US Atlantic Coast route which took a
downturnlatemonthfollowingextremelyslowcharteringactivity.

Despitethisexceedinglygrimsituation,ownersarestillresistinglayinguptheirtankersduetothecosts
and time involved and in order to maintain their approvals with oil majors. EA Gibson shipbrokers
recently estimated another 50 new VLCCs are due to enter circulation by mid2012, this expansion is
expectedtooutpaceoildemandgrowthandmayultimatelyforceownersintolayinguptheirvessels.

Shortterm floating storage of crude and products fell by 2.2mb to 48.3mb at endAugust, its lowest
levelsinceend2008.Cruderecordeditsfourthconsecutivemonthlyfall(1.2mb),to37.6mb.Thereis
nolongeranyspeculativefloatingstorageofcrude,withvolumesnowonlybeingstoredonthewater

13 S EPTEMBER 2011

45

P RICES

due to operational and logistical issues. Iran is the main

owner of this crude, currently holding 19.3mb (2.2mb
mom) as NITC continually shuttles unsold volumes to
AinSukhnaaswellasstoringsomecargoesintheMiddle
East Gulf. Additionally a ULCC has been anchored off
Brazil since November 2010 holding 3.1mb of crude for
logistical reasons. Floating storage of products fell by
1mbto10.7mbandisnowconcentratedoffWestAfrica,
withthisregionaccountingfortwothirds(7.1mb)ofthe
globalvolume.

46

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

mb
175

Global crude floating storage

(short-term and semi-permanent)
So urce: EA Gibso n, SSY and
IEA estimates

155
135
115
95
75
55
Jan

Mar

May

R a nge 2 0 0 6 - 10
2 0 11

Jul

Sep

Nov

Jan

2 0 10
A v e ra ge 2 0 0 6 - 10

13 S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

R EFINING

REFINING

Summary
Globalrefinerycruderunshavebeenreviseddownbycloseto0.3mb/dforboth3Q11and4Q11in
light of a weaker demand outlook and higher outages scheduled for a number of countries. The
largestchangeshavebeenmadetoEurope,theFSUandOtherAsia,withsomeoffsetfromstronger
North American and OECD Pacific runs. Global runs are now seen rising 1.7mb/d in 3Q11, to
75.6mb/d,andaveraging75.4mb/din4Q11.

Estimates for global crude throughputs for 2Q11 have been lifted by 120kb/d since last months
report on higher US, Middle Eastern and Other Asian runs. Combined with a weaker outlook for
global demand and hence refinery needs for the remainder of the year, the seasonal increase from
2Q11to3Q11isnowmoreinlinewithhistoricaltrends,at1.7mb/d.2Q11and3Q11runsnowsee
weakannualgrowthofaround0.2mb/d,comparedwithover2.0mb/dinthepreviousfourquarters.

OECD crude runs rose by 570kb/d in July, to 37mb/d. The seasonal increase was smaller than
expected,onaccountofpersistentlyweakEuropeanrunsandahigherUSJunebaseline.Ayearon
yeardeficitisstillevident,withtotalruns710kb/dbelowayearearlier,andonlythePacificshowing
annualgrowth.Inall,OECDrunsarepeggedat37.0mb/dfor3Q11,fallingto36.3mb/din4Q11.

OECDrefineryyieldsincreasedformiddledistillatesandotherproductsattheexpenseofallother
product categories in June. Gasoil/diesel and kerosene yields rose 0.8 percentage points (pp) and
0.1pp respectively, while OECD gasoline yields decreased slightly, mainly on a decrease in North
America. OECD gross refinery output increased by 1.4mb/d compared with May, but was still
1.1mb/dlowerthanthefiveyearaverage.

Global Refining

mb/d
77

mb/d

Crude Throughput

Global Throughputs vs. Demand

Annual growth

3.5

76

2.5

75

1.5

74

0.5

73

-0.5

72

-1.5
-2.5

71
Jan

Mar
May
Range 06-10
2010

Jul

-3.5

Sep
Nov
Jan
Average 06-10
2011 (est.)

1Q08

1Q09

Crude Runs

1Q10

1Q11

Oil Product Demand

Global Refinery Overview

Global crude runs have been cut by close to 0.3mb/d for both 3Q11 and 4Q11, following a weaker
demandoutlookandhigheroutagesscheduledforanumberofcountries.Themostsignificantchanges
havebeenmadetotheEuropeanoutlook,whererefineryrunsremainpersistentlyweak,despiterapidly
diminishingproductstocksandadditionalcrudemadeavailablethroughtheLibyacollectiveaction.The
latestdatawerealmost200kb/dbelowexpectations,andmorethan0.5mb/dlowerthanayearearlier.
Our Russian outlook is also slightly weaker than in our previous forecast, due more to a higher
maintenancescheduleratherthanbecauseofthenewexportdutyregime(seeImplicationsofRussian
Tax Changes on Refining More LongTerm). Apparent delays in starting up new capacity in India, and
continuedoutagesatTaiwanslargeMailiaorefineryweighontheOtherAsianforecast.Recentrobust
runsintheUSandSouthKorea,bothsupportedbystrongproductexports,providesomeoffset.Global
runsareseenrisingby1.7mb/din3Q11,to75.6mb/dandtheneasingto75.4mb/din4Q11.

13S EPTEMBER 2011

47

R EFINING

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Estimatesforglobalcrudethroughputsfor2Q11havebeenliftedby120kb/dsincelastmonthsreport,
onhigherUS,MiddleEasternandOtherAsianruns.Combinedwithaweakeroutlookforglobaldemand
andhencerefineryneedsfortheremainderoftheyear,theseasonalincreasefrom2Q11to3Q11isnow
moreinlinewithhistoricaltrends,at1.7mb/d.2Q11and3Q11runsnowseeweakannualgrowthof
around0.2mb/d,comparedwithover2.0mb/dinthepreviousfourquarters.GrowthintheFSU,China,
Latin America and Other Asia is offset by structural and temporary declines in the OECD and
Africa,respectively.

mb/d
8.0

Global Crude Runs

mb/d

Quarterly Change
2.5
2.0
1.5
1.0
0.5
0.0
-0.5
-1.0
-1.5

Firm Global Refinery Shutdowns

6.0
4.0
2.0
0.0
1Q
2004
2008

2Q
2005
2009

3Q
2006
2010

4Q
2007
2011

Oct-10

Jan-11

Apr-11

OECD NAM
OECD Pacific
Est. 'yet-to-be reported'

Jul-11

Oct-11

OECD Europe
ROW
World Y-1

Global crude runs are thought to have peaked seasonally in August, at 76.1mb/d. This is a 3.5mb/d
swing from this years April low. As the peak summer driving season has ended, refinery runs have
alreadystartedtowinddownandwillfallfurtherasseasonalmaintenancepicksup.Whiletheautumn
turnaroundschedulesarenotasheavyasinthespring,upto5.0mb/dofcapacityisnormallytakenoff
lineinOctober,thepeakmonth. RelativelyheavymaintenanceinRussiaandIndiathisautumnaddto
regularOECDturnarounds.

RefinerymarginsimprovedsomewhatinJulyandAugust,especiallyforEuropeancrackingrefineries.US
GulfCoastmarginsalsostrengthened,especiallyforLLScrackingandMayacokingplants.Singaporeeven
saw hydroskimming margins turning positive for Dubai in August. Nevertheless, margins remain under
pressure,andtherecentannouncementfromUSEastCoastrefinerSunocoofplanstoexittherefining
sector comes neither as a surprise nor is it likely to be an isolated case. More plants will have to shut
beforeenoughofthestructuralcapacityoverhangiserodedtoallowthemarkettoagainrebalance.

Global Refinery Crude Throughput1

(million barrels per day)
May 11

Jun 11

2Q2011

Jul 11

Aug 11

Sep 11

3Q2011

Oct 11

Nov 11

Dec 11

4Q2011

North America

17.5

18.0

17.5

18.2

18.4

17.7

18.1

17.1

17.4

17.6

17.3

Europe

11.9

12.2

11.9

12.4

12.5

12.2

12.4

12.0

12.2

12.2

12.1

Pacific

6.0

6.2

6.2

6.5

6.8

6.4

6.6

6.4

7.0

7.1

6.8

35.5

36.5

35.7

37.0

37.7

36.3

37.0

35.4

36.6

36.9

36.3

Total OECD
FSU

6.4

6.8

6.5

6.7

6.5

6.4

6.5

6.3

6.5

6.6

6.5

Non-OECD Europe

0.5

0.5

0.5

0.5

0.5

0.4

0.5

0.5

0.5

0.5

0.5

China

9.1

8.7

8.9

8.8

8.9

9.0

8.9

9.1

9.4

9.4

9.3

Other Asia

9.0

9.3

8.9

9.1

8.7

8.9

8.9

9.1

9.2

9.3

9.2

Latin America

5.4

5.3

5.4

5.3

5.4

5.4

5.4

5.4

5.4

5.4

5.4

Middle East

5.7

6.0

5.8

6.2

6.2

6.2

6.2

6.2

6.0

6.0

6.1

2.2

2.1

2.1

2.2

2.1

2.1

2.2

2.1

2.2

2.3

2.2

Total Non-OECD

Africa

38.2

38.7

38.1

38.7

38.4

38.6

38.5

38.6

39.2

39.5

39.1

Total

73.7

75.2

73.8

75.7

76.1

74.9

75.6

74.1

75.8

76.4

75.4

1 Preliminary and estimated runs based on capacity, know n outages, economic run cuts and global demand forecast

48

13S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

R EFINING

OECD Refinery Throughput

OECDrefinerythroughputsroseby570kb/dinJuly,toaverage37.0mb/d.Whilerunsroseinallregions,
theseasonalincreasewasweakerthanexpectedandonlyOECDPacificthroughputsstoodaboveyear
earlier levels. North American and European runs were 420kb/d and 540kb/d below July 2010
respectively, asdemandoverthepeak summerseasonhasbeen lacklustreatbestanddeliverieshave
come from storage. A higher baseline for North America, following upward revisions to June data,
neverthelessliftstheNorthAmericanprognosis,andprovidesanoffsettoaweakeroutlookforEurope.
Inall,OECDcruderunsarepeggedat37.0mb/dfor3Q11,fallingseasonallyto36.3mb/din4Q11.
Refinery Crude Throughput and Utilisation in OECD Countries
(million barrels per day)
Change from

US2
Canada
Mexico

Jun 11

Jul 10

Utilisation rate1

Feb 11

Mar 11

Apr 11

May 11

Jun 11

Jul 11

Jul 11

Jul 10

13.75

14.45

14.30

14.78

15.37

15.44

0.08

-0.08

87.9%

88.6%

1.77

1.78

1.57

1.54

1.54

1.56

0.03

-0.29

85.2%

94.7%

1.16

1.20

1.26

1.15

1.14

1.16

0.01

-0.05

75.2%

78.7%

16.68

17.43

17.14

17.46

18.05

18.16

0.12

-0.42

86.7%

88.4%

France

1.35

1.26

1.18

1.33

1.35

1.34

-0.01

-0.11

81.5%

79.7%

Germany

1.93

1.73

1.85

1.84

1.78

2.02

0.23

0.03

84.3%

83.1%

Italy

1.55

1.54

1.52

1.56

1.62

1.55

-0.08

-0.21

70.9%

77.2%

Netherlands

1.12

1.08

0.80

1.00

1.04

1.08

0.04

0.00

83.4%

83.4%

Spain

0.97

0.96

1.09

1.01

1.06

1.01

-0.05

-0.13

72.1%

81.3%

United Kingdom

1.42

1.39

1.51

1.50

1.45

1.50

0.05

0.03

83.0%

81.2%

Other OECD Europe

3.83

3.79

3.65

3.72

3.92

3.92

0.01

-0.14

79.6%

83.0%

12.16

11.74

11.61

11.95

12.23

12.42

0.19

-0.54

79.3%

81.5%

Japan

3.80

3.15

3.10

2.78

2.93

3.22

0.29

-0.03

70.1%

68.5%

South Korea

2.53

2.52

2.58

2.51

2.52

2.52

0.00

0.24

92.0%

83.2%

Other OECD Pacific

0.77

0.78

0.78

0.75

0.75

0.72

-0.03

0.04

78.2%

74.0%

OECD North Am erica

OECD Europe

OECD Pacific
OECD Total

7.09

6.45

6.46

6.04

6.20

6.45

0.26

0.25

78.2%

73.9%

35.94

35.62

35.20

35.45

36.47

37.04

0.57

-0.71

82.6%

83.3%

1 Expressed as a percentage, based o n crude thro ughput and current o perable refining capacity
2 US50

OECDNorthAmericancruderunsroseby120kb/dinJuly,lessthanthe350kb/dincreaseindicatedby
preliminarydata,onacombinationofhigherUScruderunsforJuneandweakerCanadianandMexican
runsinJuly.Totalregionalrunswerestillsome420kb/dbelowyearearlierlevels.Weeklydatafromthe
EIAshowUSrunsrisingfurtherinAugust.Inall,NorthAmericanrunsareexpectedtoaverage18.1mb/d
in3Q11,beforefallingto17.3mb/din4Q11.

mb/d

OECD North America

m b/d
17

Crude Throughput

19

US Weekly Refinery Throughput

16
18

16
15

17

15

16

14
Source: EIA

15
Jan

Mar
May
Jul
Range 06-10
2010
2011(est.)

13S EPTEMBER 2011

14
Jan

Sep
Nov
Jan
Average 06-10
2011

Mar
May
Jul
Range 2006-2010
2010

Sep
Nov
5-yr Average
2011

49

R EFINING

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

US crude runs were stronger than expected in August, at 15.5mb/d (+90kb/d compared with last
months report). Gulf Coast runs in particular rose to their highest monthly average in over a year,
supportedbyhealthycokingandLLScrackingmargins.OnlyBrentmarginswerenegative.USEastCoast
refiners suffered losses when Hurricane Irene ripped through the region in late August. While only
ConocoPhillips 238kb/d Bayway (NJ) refinery shut down ahead of the storm, other refineries in the
regionoperatedatreducedratetoallowforphasedshutdownsifneeded.
m b/d

US PADD 3 Refinery Throughputs

m b/d

8.5

1.8

8.0

1.6

US PADD 1 Refinery Throughputs

1.4

7.5

1.2

7.0

1.0
6.5

0.8

Source: EIA

6.0
Jan

Mar

May

Jul

Range 2006-2010
2010

Sep

Nov

Source: EIA

0.6
Jan

5-yr Average
2011

Mar
May
Jul
Range 2006-2010
2010

Another Refiner Bows Out - Sunoco Announces Refinery Exit

Sep
Nov
5-yr Average
2011

US refiner and fuel marketer Sunoco announced on 6 September it will exit the refinery business and
attempttosellitsMarcusHookandPhiladelphiarefineriesinPennsylvania.Thetworefineries,withcapacity
of175kb/dand330kb/d,respectively,accountforalmost35%ofUSEastCoastoperablerefiningcapacity.
Whilethecompanyhasstateditwilldoitsutmosttofindsuitablebuyers,itmightstruggletodosobythe
July 2012 deadline. By that date, if no buyers have been found, the plants main processing units will be
idledandpretaxchargesofupto$500millionforcontractterminations,staffingcostsandseverancepaid.
Sunocosannouncementdoesnotcomeasasurprise,asthecompanysrefiningandsupplybusinesshaslost
moneyineightofthelasttenquarters.Refininglossesamountedto$316millionin2009,$8millionin2010
and$182millioninthefirstsixmonthsof2011.Withthisinmind,thecompanywilllikelystruggletofind
buyers for its plants and closure looks to be a strong possibility. Furthermore, the plants face significant
capacity outlays to satisfy environmental requirements and ensure safe, reliable operations Sunoco CEO
Elsenhans said during a conference call. This is not taking into consideration the large investment
requirementsneededtoimprovemarginsandprofitability.
Iftheplantsendupclosing,itwillhaveasignificantimpactontheUSEastCoastrefiningsector,increasing
theregionsrelianceonproductimportsandprovidingsomerelieftoremainingoperators.Sunocoalready
shutitsEaglePointrefineryinNewJerseyin2009andsoldits170kb/dToledorefineryinOhio,alongwitha
petrochemicalfacilityinPhiladelphia,toPBFHoldinginMayofthisyear.TheUSEastCoastalreadyimports
large volumes of gasoline from the Gulf Coast and Europe. In August, the region imported 630kb/d of
gasolinegradesaccordingtoEIAdata.
Sunoco, which mainly processes Nigerian and other
Africanlightsweetcrudes,isatadisadvantagetoGulf
Coast and Midwest refiners who benefit from
discountedWTIrelatedcrudes.Furthermore,sincethe
Libyan disruption, Sunoco has had to scramble to
sourceadequatelowsulphurbarrelsandhasimported
crudes from not only West Africa, but also from
Norway, Brazil and Azerbaijan at higher costs, further
pressuringmargins.

$/bbl
14

US East Coast 6-3-2-1 Crack Spread

Cracks to Bonny

12
10
8
6
4
2
0

CEO Elsenhans said Sunocos decision to exit the

Jan 09 Jul 09 Jan 10 Jul 10 Jan 11 Jul 11
industry was influenced by weak US Northeast crack
spreads.BecauseSunocoproducesasignificantvolumeofresidualfuel,a6321crackspread(6barrelsof
crude, yielding 3 barrels of gasoline, two barrels of distillate and one barrel of fuel oil) is used to assess
marketconditions.Whilesomeimprovementshavebeenseenrecently,thishasclearlynotbeenenoughto
retainSunocosinterestintheassets.

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Europeanrefineryactivitycontinuestodisappoint,andJulyestimateshavebeenreviseddownbyclose
to 200kb/d since last months report. While total regional throughputs gained 195kb/d versus June,
mostlyonhigherGermanruns,theyneverthelessstood540kb/dbelowJuly2010.Notably,Italianruns
haveremainedweaksincethestartoftheLibyandisruption.Italianrefinerswerethelargestbuyersof
Libyancrudepriortothedisruptions,importingalmost370kb/dofcrudeoilfromLibyain2010.While
theseasonalincreaseinrunshasbeenweakerthannormal,thereleaseofcrudeandproductstocksand
the lowering of stockholding obligations through the Libya collective action provided flexibility to
operators as to how to best meet demand. Euroilstock data released on 9 September show Euro15 +
Norwayrunsrisingby85kb/dinAugust.

OECD Europe

14.4

mb/d
2.0

13.9

1.9

13.4

1.8

mb/d

Crude Throughput

12.9

Italy
Crude Throughput

1.7

12.4

1.6

11.9

1.5

11.4
Jan

Mar May
Range 06-10
2010
2011(est.)

Jul

Sep

Jan

Nov Jan
Average 06-10
2011

Mar
May
2007
2009
2011

Jul

Sep

Nov
Jan
2008
2010
2011 (est.)

Despitethebleaksituation,ConocoPhillipsannouncedon10Augustthatithadfinallyfoundabuyerfor
its260kb/dWilhelmshavenrefineryinGermany.Theplant,whichhasbeenmostlyidlesince2009,was
intheprocessofbeingconvertedtoanoilterminal,whenDutchHestyaEnergysignedtheagreementto
buytheplant,storagefacilitiesandmarineterminal.Despitetherecentsale,wethinkitisunlikelythat
the plant will be restarted (at least in the near term) given the dire hydroskimming margins in Europe
and the large investment requirements needed to improve light product yields from the current 53%.
Conoco scrapped plans to upgrade the plant in 2010, which had included a coker and a hydrocracker,
estimatedatmorethan$2bn.Instead,thecompanywilllikelyusetheplantforitsmidstreamassets.

OECDPacificcruderunsforJulyroseby260kb/dfromJuneslevels,slightlylessthananticipatedinlast
months report. Yearonyear gains of some 250kb/d are entirely concentrated in South Korea, which
continuestoseeexceptionallystrongproductexports.JulydatafromtheMinistryshowrefinedproduct
exportsof42.22mb(1.36mb/d),up31%onayearearlierandanewrecordhigh.Koreanrunsaveraged
2.5mb/dinJuly,unchangedfromamonthearlier,but240kb/daboveJuly2010.

OECD Pacific

mb/d

m b/d
5.0

Crude Throughput

8.0

Japan Weekly Refinery Throughput

4.5

7.5

4.0

7.0
6.5

3.5

6.0

3.0

5.5

2.5
Jan

Source: PAJ, IEA est imates

Jan

Mar
May
Range 06-10
2010
2011 (est.)

Jul

Sep
Nov
Jan
Average 06-10
2011

Apr
Jul
Range 2006-10

Oct
5-yr Average

2010

2011

JapanesecruderunswererevisedslightlylowerforJuly,toaverage3.2mb/d.Accordingtoweeklydata
fromthePetroleumAssociationofJapan,runsrosefurtherinAugust,beforedecliningseasonallybyend
month. The countrys largest refinery JX Nippon Oil and Energy announced it would cut runs in

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September,to9%belowlastyearslevelduetoscheduledmaintenanceattheMizushimarefineryduring
September/October. The company also stated that it expects its Kashima plant to reach full operating
ratesfromaroundNovember,comparedwithcurrentlevelsaround70%.Petrobras100kb/dNishihara
refineryonOkinawawasdamagedinatyphooninearlyAugustandonlyrestartedinmidAugust.

Non-OECD Refinery Throughput

NonOECD crude runs have been revised lower for the remainder of 2011, by about 200kb/d on
average. Weakerthanexpected runs in both India and Brazil in July have partly been carried forward,
andhigherrefinerymaintenanceschedulesinRussiaandanewexporttaxsystemtherelowerourFSU
forecastslightly.ApparentdelaysinstartingupnewcapacityinIndiahavealsobeenfactoredin.

Despitetheserevisions,annualthroughputgrowthisagainseenstemmingentirelyfromthenonOECD,
with China, Latin America and Other Asia offsetting decline in the OECD and Africa. The nonOECD is
growingby0.9mb/donaveragein2Q114Q11period,comparedwiththroughputgrowthofmorethan
2.0mb/d in 1Q11 and 1.3mb/d on average in 2010. In all, nonOECD runs are forecast to grow from
38.1mb/din2Q11to38.5mb/din3Q11and39.1mb/din4Q11.

mb/d
40
39
38
37
36
35
34
33
Jan

Non-OECD Total

mb/d

Crude Throughput

3.0

Global Crude Throughputs

Annual Change

2.0
1.0
0.0
-1.0
-2.0
-3.0
Mar
May
Jul
Range 06-10

1Q09 3Q09 1Q10 3Q10 1Q11 3Q11

North America Europe
Pacific
China
Other Asia
Middle East
Latin America Other

Sep
Nov
Jan
Average 06-10

2010

2011(est.)

After an exceptionally weak June, Chinese refinery runs rebounded in July, posting annual growth of
520kb/d,or6.3%,comparedwithonly0.6%inJune.At8.8mb/d,totalrunswere175kb/dhigherthana
month earlier, and 110kb/d above expectations. Runs are expected to increase further in August and
September,despitecontinuedproblemsatPetroChinasDalianrefinery.The400kb/dplantwasforced
toshutoneofitstwocrudedistillationunitsinmidJuly,whenafirebrokeout.Asecondfirebrokeout
duringrestartoftheunitatendAugust,forcingtheheadoftheplanttoresign.

China
mb/d
9.5
9.0
8.5
8.0
7.5
7.0
6.5
6.0
5.5
Jan

mb/d

Crude Throughput

Chinese Crude Runs

Annual growth

2.0
1.5
1.0
0.5
Mar May
2008
2010
2011 (est.)

Jul

Sep

Nov
2009
2011

Jan

0.0
Jan-10

May-10

Sep-10

Jan-11

May-11

While maintenanceshutdownsareexpected toremainaroundJulyslevels inAugust,industrysurveys

showstateownedrefinersplanningtoliftrunratestomeetseasonallyhigherproductdemand.There

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werealsoreportsofSinopecstartingupanew160kb/dcrudeunitatitsChanglingplantinAugust,with
anaimtostartcommercialoperationsinSeptember.Itisnotcleariftheplantscurrent70kb/dCDUwill
beshut,orifthereisenoughpipelinecapacitytoruntheplantatfullrates.Maintenanceschedulesstart
tounwindfromSeptember,suggestingincreasingrunsthroughthelatterpartoftheyear.

Other Asian refinery runs are seen dipping in August and September, on the shutdown of Taiwans
MailiaorefineryandmaintenanceinVietnamandIndia.Indiancruderunswerelowerthanexpectedin
July,andhavebeenreviseddownby220kb/dsincelastmonthsreport.ItseemsthatBPCL/OmanOils
120kb/dBinarefineryisstillexperiencingstartupproblemsrelatedtopowersupplyandfullratesare
nownotexpecteduntilSeptember(wehadpreviouslyassumedtheplantwouldalreadyberunningat
fullcapacityfromJuly).ReportsarethatHPCL/Mittals180kb/dBathindaplantalsostartedprocessing
crudeinlateAugust.WhilecompanyestimatessuggesttheplantwillbefullyoperationalbyNovember,
some market observers say it will only be commissioned at the end of this year at the earliest. Indian
capacity will be further boosted when an 80kb/d expansion at Essars Vadinar refinery becomes
operationalinearly2012.The280kb/dplantwillundertakea35daycompleteshutdowntotieinnew
unitsfrom18September.TotalIndiancruderunsareestimatedat4.1mb/dinJuly,adjusted0.7mb/d
above ministry data, to account for runs at Reliances export refinery at Jamnagar and the recently
commissionedBinarefinery,notincludedinofficialstatistics.

Other Asia

mb/d
10.0

Crude Throughput

mb/d
4.5

India
Crude Throughput

4.0

9.5
9.0

3.5

8.5
8.0

3.0

7.5
2.5

7.0
Jan

Mar May
Range 06-10
2010

Jul

Sep Nov Jan

Average 06-10
2011(est.)

Jan

Mar
May
2007
2009
2011

Jul

Sep

Nov
Jan
2008
2010
2011 (est.)

InTaiwan,Formosarestartedoneofitsthree180kb/dcrudedistillationunitsattheendofAugust.The
entire 540kb/d Mailiao plant had been closed since the end of July, when the seventh fire in a year
brokeoutatthefacilities.WeassumethatallthreeunitswillbeoperationalbytheendofSeptember,
although startup still depends on the governments approval. Elsewhere, Vietnam restarted the
140kb/d Dung Quat plant ahead of schedule on 26 August after a planned twomonth complete
turnaroundfrommidJuly.TheplantwasoriginallytorestartinmidSeptember.

Russia
Russian crude runs fell slightly from Junes recordhigh; mb/d
Crude Throughput
toaverage5.32mb/d.Runswerenevertheless5%above 5.5
a yearearlier, with gasoline output in particular higher
yearonyear. These were up 1.8% and 9.3% on a 5.0
monthly and annual basis, respectively, as refiners are
struggling to prevent further domestic gasoline 4.5
shortages.DespitethehigherthanexpectedJulyfigures,
we have revised down our outlook for Russian refinery 4.0
runs for the remainder of the year. The most recent
Jan
Mar
May
Jul
Sep Nov
Jan
2007
2008
schedules released by the Energy Ministry show
2009
2010
extensive maintenance at several large plants planned
2011
2011 (est.)
forSeptemberandOctober.

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Implications of Russian Tax Changes on Refining More Long Term

The new Russian export duty regime discussed in Russia: Upstream and Export Impacts of the 6066 Tax
RegimeintheSupplysectioncouldalsohaveanimpactontherefineryindustry,butmostlikelymoresoin
thelongerterm.
The aim of the new tax rules is twofold. Firstly, to reduce the tax burden on oil producers to encourage
upstreaminvestmentsinnewfieldsandtostemdepletion.Secondly,toencouragerefinerstoupgradetheir
plantsandreducefueloilyields.The19%increaseinfueloildutieswillslashthesteepdiscountinfueloil
duties to crude and light products currently, starting in October. While the new regime will lower
profitabilityforrefinersexportingfueloil,theimpactonrefineryrunsandtradepatternsislessclearcut.
Accordingtosometraders,exportsofstraightrunfueloilwillremainprofitableevenwiththehigherduties,
whileothersthinkfueloilexportscouldtakeahitfromhighercrudeexports.Inadditiontosome400kb/d
offueloilimportsfromtheFSUin2010,OECDEuropeimportedmorethan200kb/dofrefineryfeedstocks
fromtheregionlastyear,with6570%comingfromRussia.Givenrecentdomesticproductshortagesanda
tight market for light products, margins remain relatively strong in Russia, and we think runs will be
sustainedatrelativelyhighratestofeeddomesticdemandforlightproducts.Asaresult,fueloilproduction
andexportswilllikelybesustainedclosetocurrentlevelsintheimmediatefuture.
Intheveryshortrun,refinerscouldtrytomaximiserunsandincreaseproductexportsthroughSeptember,
and several companies have talked about postponing maintenance work until after the 1 October tax
change. Reportedly, Lukoil is to postpone work at its Perm and Norsi plants until October, while
GazpromneftisalsotopostponeplannedshutdownsatitsOmskandMoskowrefineriesuntilOctoberand
November,respectively.
Longerterm,thenewtaxesshouldprovideincentivesforrefinerstoinvestinupgradingandmodernisation
of plants. From January 2015, the fuel oil duty is set to increase to 100% of the crude duty, potentially
makingoilproductexportsunprofitableevenwithmodernisation.Thiswouldsignificantlyincreasetherate
ofreturnonupgradinginvestments,butitsimplementationisstillakeyuncertainty.
While it is impossible to predict the exact effects of the new tax regime on runs and export patterns, we
haveadjusteddownourcruderunsforecastslightlyforthetailendoftheyear,andnowseecruderunsfall
from5.2mb/din3Q11to5.1mb/din4Q11.

LatinAmericancruderunsdeclinedmarginallyoverJuneand July,onlowerthroughputs inBrazil.The

latterfellfrom1.92mb/dinMayto1.68mb/dinJuneand1.73mb/dinJuly.LowerrunsatPetrobras
240kb/dReduc(DuquedeCaxias)refineryinRiodeJaneirostateandRPBC(PresBernandes)Cubatao
refinery,mostlikelyduetomaintenanceshutdowns,promptedthedeclines.AlsoownedbyPetrobras,a
31kb/drefineryinBahiaBlancainArgentinawasshuton10Augustafteranexplosionkilledoneworker.
Whiletheplantrestartedon17August,provincialauthoritieshavethreatenedtoclosetheplantagain,
unlessthecompanyprovidessomeassurancesonsafety.ArgentineanrefineryoutputwascutinJune,
whenstrikesintheSantaCruzregioncutintoproductionandlimiteddeliveries.

mb/d
2.0

Latin America

mb/d
5.8

Crude Throughput

5.6

1.9

5.4

1.8

5.2

1.7

5.0

1.6

4.8

1.5

4.6
Jan

Mar

May

Range 06-10
2010

54

Brazil
Crude Throughput

Jul

Sep

Nov

Jan

Jan

Average 06-10
2011(est.)

May
Mar
2007
2009
2011

Jul

Sep

Nov
Jan
2008
2010
2011 (est.)

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In nonOECD Europe, Lukoil resumed operations at its 140kb/d Neftokhim plant in Bulgaria in early
August, after Sofias administrative court overturned the customs authorities decision to suspend the
Russian majors fuel depot license. The license had been suspended after the firm failed to meet a
deadlinetoinstallflowmeterslinkingtherefinerytotheBulgariancustomsagency,andasaresultthe
planthadtostopcrudeprocessingbrieflyinlateJuly.

Libyan Refinery Status

LibyanrefineryoperationscametoacompletehaltinAugust,whenthe120kb/dZawiyarefinery,located
50km west of Tripoli ceased throughputs. The plant had been one of the few sources of fuel for Colonel
GaddafistroopsandthepeopleofTripolisincethebeginningoftheconflict,butrebelstookcontrolofthe
planton17AugustandthepipelinelinkingittoTripoliwassevered.Mostrecentestimatessuggestthatthe
refinery was operating at 40kb/d before the complete
shutdown,duetolackofcrudesupplies.BothZawiyaand
Libya
mb/d
Crude Throughput
thesmallerTobrukrefinery(20kb/d)arenotbelievedto
0.4
have sustained serious damage and are likely to restart
0.3
operations relatively quickly as crude supplies are
restored. Stateowned Agoco said in early September,
0.2
Tobruk and the smaller 10kb/d Sarir refinery could be
restarted by endmonth, coinciding with a planned
0.1
productionstartupattheSarirandMeslaoilfields.
0.0

The state and likely start up of the 220kb/d Ras Lanuf

Jan
Mar
May
Jul
Sep Nov
Jan
refinery, is more uncertain. The plant, which is the
2007
2008
countrys largest, has been closed since February, when
2009
2010
staff left and the plant was shut down for security
2011
2011 (est.)
reasons.Accordingtotherefinerymanager,theplantis
intactandthecompanyisplanningtorestartthecomplex.Otherreports,however,indicatemoreserious
damage to the facilities, and on 12September Gaddafi forces reportedly attacked the plant, killing
15guards.Moreover,thebeacharoundRasLanufanditsporthasreportedlybeenheavilymined,further
impeding restart of facilities there. Startup will depend not only on the state and accessibility of these
facilities, but also on the resumption of crude production and infrastructure to bring feedstock to the
refinery.TheRasLanufplantisthereforeassumedtoremainofflineforsomemoremonthstocome.
Inthemeantime,ItalysEnihasagreedtoprovideafirstsupplyofrefinedproductstotheNTCtocontribute
tothebasicandmosturgentneedsoftheLibyanpopulation,accordingtoastatementon29August.On
30August, there was a flurry of reports of product shipments heading from Malta to the Libyan ports of
Benghazi,MisrataandKhoms.ThisfollowspressreportsthattraderVitolcontinuedtodeliverproductsto
rebelforcesineasternLibyathroughoutmuchoftheconflict.

OECD Refinery yields

OECD refinery yields increased for middle distillates and other products at the expense of all other
productcategoriesinJune.Gasoil/dieselyieldsrose0.8percentagepoints(pp),withOECDPacificbeing
the largest contributor, leaving yields 0.2pp above last years level and above the fiveyear range. Jet
fuel/keroseneyieldsroseamodest0.1pp,asincreasesinbothNorthAmericaandEuropewereoffsetby
adecreaseinthePacific.OECDgasolineyieldsdecreasedslightlyinJune,mainlyonadecreaseinNorth
America,whereasyieldsintheothertwomainregionsweremoreorlessunchangedvsMay.OECDgross
refinery output increased by 1.4mb/d compared with May, but was still 1.1mb/d lower than the
fiveyearaverageasespeciallyOECDEuropeanrunsweretrendingbelowtheirfiveyearaverage.

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37%

OECD - Gasoline

OECD - Gasoil / Diesel

Refinery Yield - Five-year Range

Refinery Yield - Five-year Range

32%

36%

31%

35%
30%

34%

29%

33%
32%

28%
Jan

Apr

Jul

Range 2006-10
2010

Oct

Jan

Jan

5-yr Average
2011

Apr

Jul

Range 2006-10
2010

Oct

Jan

5-yr Average
2011

InOECDNorthAmerica,yieldsincreasedforgasoil/dieselasdistillatecrackspreadswerestrongduetohigh
exportdemandandexpectationsoftightermarketsahead.Gasolineyieldsdecreasedslightlyinlinewith
seasonaltrends,butyieldsarestillhigh,andat47.9%theystand1.2ppabovethefiveyearaverage.

OECD N. America - Gasoline

OECD Europe - Gasoline

Refinery Yield - Five-year Range

Refinery Yield - Five-year range

50%
49%
48%
47%
46%
45%
44%
43%

24%
23%
22%
21%
20%

Jan

Apr
Range 2006-10

Jul

Oct

Jan

5-yr Average

Jan

Apr
Range 2006-10
2010

Jul

Oct

Jan

5-yr Average
2011

2010
2011

InOECDEurope,bothgasoil/dieselandgasolineyieldswerepracticallyunchangedcomparedwithMay.
IncontrasttoNorthAmerica,Europeangasolineyieldshavebeen0.40.7pplowerthanlastyearslevel
sofarthisyear,reflectingreducedregionaldemandforthemotorfuel.Gasoil/dieselyieldsontheother
handwerejustbelowlastyearslevelinJune,supportedbyimproveddistillatecrackspreads.

In OECD Pacific, gasoline yields increased somewhat, and at 23.3% they were 0.1pp higher than last
years recordhigh level for June. Gasoil/diesel yields increased 1.8pp, and stood in June some 1.5pp
above the fiveyear average and 1.3pp above last years level. The increased yields for these product
categoriesweresupportedbystrongerproductcracksandexpectationsofstrongdemand,especiallyfor
gasoil/diesel.

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T ABLES

Table 1
WORLD OIL SUPPLY AND DEMAND

TABLES

(million barrels per day)

Table 1 - World Oil Supply and Demand

2008 2009

1Q10 2Q10 3Q10 4Q10 2010

1Q11 2Q11 3Q11 4Q11 2011

1Q12 2Q12 3Q12 4Q12 2012

OECD DEMAND
North America
Europe
Pacific

24.2 23.3
15.4 14.7
8.1
7.7

23.4 23.7 24.1 23.9 23.8

14.3 14.3 14.9 14.8 14.6
8.2
7.3 7.6
8.1
7.8

23.8 23.3 23.7 23.5 23.6

14.2 14.1 14.5 14.5 14.3
8.3 7.1 7.7
8.3 7.9

23.5 23.1 23.6 23.5 23.4

14.1 13.9 14.5 14.5 14.2
8.6 7.4
7.5 8.1
7.9

Total OECD

47.6 45.6

45.9 45.3 46.6 46.7 46.2

46.3 44.6 45.9 46.4 45.8

46.2 44.4 45.6 46.0 45.6

4.2
4.2
0.8
0.7
7.7
8.1
9.7 10.1
6.0
6.0
7.2
7.5
3.3
3.3

4.4
4.3 4.6
4.6
4.5
0.7
0.7 0.7
0.7
0.7
8.6
9.1 8.9
9.7
9.1
10.4 10.5 10.1 10.5 10.4
6.0
6.3 6.5
6.4
6.3
7.4
7.8 8.3
7.7
7.8
3.3
3.4 3.4
3.4
3.4

4.5 4.6 4.8

4.7 4.6
0.7 0.7 0.7
0.7 0.7
9.5 9.5 9.5
9.8 9.6
10.7 10.8 10.5 10.8 10.7
6.3 6.5 6.6
6.5 6.5
7.6 8.0 8.5
7.8 8.0
3.4 3.3 3.3
3.4 3.4

4.6 4.6
4.9 4.8
4.7
0.7 0.7
0.7 0.7
0.7
10.0 10.1 10.0 10.3 10.1
11.1 11.2 10.8 11.3 11.1
6.5 6.7
6.9 6.8
6.7
7.9 8.3
8.8 8.1
8.3
3.5 3.6
3.5 3.6
3.5

Total Non-OECD

38.9 39.9

40.8 42.1 42.4 43.0 42.1

42.7 43.5 43.9 43.9 43.5

44.2 45.2 45.6 45.5 45.1

86.5 85.5

86.8 87.4 89.0 89.7 88.2

89.0 88.1 89.8 90.2 89.3

90.4 89.6 91.2 91.5 90.7

Europe
Pacific

13.3 13.6
4.8
4.6
0.6
0.7

14.0 14.0 14.1 14.4 14.1

4.5
4.2 3.8
4.2
4.2
0.6
0.6 0.6
0.6
0.6

14.4 14.2 14.0 14.4 14.2

4.1 3.8 3.9
4.3 4.0
0.5 0.5 0.6
0.6 0.6

14.5 14.3 14.2 14.5 14.4

4.2 3.9
3.9 4.1
4.0
0.7 0.7
0.7 0.7
0.7

Total OECD

18.7 18.8

19.1 18.8 18.5 19.2 18.9

19.0 18.5 18.4 19.3 18.8

19.4 18.9 18.8 19.3 19.1

12.8 13.3
0.1
0.1
3.8
3.9
3.7
3.6
3.7
3.9
1.7
1.7
2.6
2.6
28.4 29.1

13.5 13.5 13.5 13.6 13.5

0.1
0.1 0.1
0.1
0.1
4.0
4.1 4.1
4.2
4.1
3.7
3.7 3.7
3.7
3.7
4.0
4.1 4.1
4.1
4.1
1.7
1.7 1.7
1.7
1.7
2.5
2.5 2.5
2.5
2.5
29.6 29.7 29.9 30.0 29.8

13.6 13.6 13.6 13.7 13.6

0.1 0.1 0.1
0.1 0.1
4.2 4.2 4.2
4.2 4.2
3.6 3.5 3.5
3.5 3.5
4.2 4.2 4.3
4.5 4.3
1.7 1.6 1.6
1.7 1.7
2.5 2.5 2.5
2.5 2.5
30.1 29.6 29.9 30.3 30.0

13.7 13.8 13.6 13.8 13.7

0.1 0.1
0.1 0.1
0.1
4.3 4.3
4.3 4.3
4.3
3.5 3.5
3.5 3.5
3.5
4.5 4.6
4.6 4.6
4.6
1.7 1.7
1.7 1.7
1.7
2.6 2.6
2.6 2.6
2.6
30.5 30.5 30.4 30.5 30.5

NON-OECD DEMAND
FSU
Europe
China
Other Asia
Latin America
Middle East
Africa

Total Demand

OECD SUPPLY
North America4

NON-OECD SUPPLY
FSU
Europe
China
Other Asia2
Latin America2,4
Middle East
Africa2
Total Non-OECD
Processing Gains3

2.0

2.0

2.0

2.1

2.1

2.1

2.1

2.2

2.1

2.1

2.2

2.2

2.3

2.2

2.2

2.3

2.3

Global Biofuels4

1.4

1.6

1.4

2.0

2.1

1.8

1.8

1.5

1.9

2.1

1.9

1.9

1.6

2.0

2.4

2.1

2.0

Total Non-OPEC2

50.6 51.6

52.2 52.5 52.6 53.1 52.6

52.7 52.2 52.6 53.7 52.8

53.8 53.6 53.8 54.2 53.8

Non-OPEC: Historical Composition2

49.6 51.6

52.2 52.5 52.6 53.1 52.6

52.7 52.2 52.6 53.7 52.8

53.8 53.6 53.8 54.2 53.8

Total OPEC2

31.6 29.1
4.5
4.9
36.2 34.1

29.3 29.3 29.7 29.6 29.5

5.2
5.2 5.5
5.6
5.3
34.5 34.5 35.1 35.2 34.8

30.0 29.4
5.8 5.8
35.8 35.2

OPEC: Historical Composition2

37.2 34.1

34.5 34.5 35.1 35.2 34.8

35.8 35.2

Total Supply6

86.8 85.6

86.6 87.0 87.7 88.3 87.4

88.5 87.4

0.4
0.0

0.9
-0.1

-0.1
-0.1

0.1
0.0

-0.4
0.0

OPEC
Crude5
NGLs

STOCK CHANGES AND MISCELLANEOUS

Reported OECD
Industry
0.3 -0.1
Government
0.0
0.1
Total
Floating Storage/Oil in Transit
Miscellaneous to balance7
Total Stock Ch. & Misc

-0.9
0.1

5.9

6.0

5.9

6.2

6.2

6.4

6.4

6.3

0.5
0.0

0.3

0.0

0.4

0.9

-0.2

-0.7

0.1

-0.4

0.5

0.0
-0.1

0.3
-0.2

-0.2
-0.3

0.1
-1.3

-0.2
-0.8

-0.3
-0.3

-0.2
-0.7

0.2
-0.2

-0.2
-0.9

0.2

0.1

-0.1

-0.4

-1.3

-1.4

-0.8

-0.5

-0.6

Memo items:
Call on OPEC crude + Stock ch.8
Adjusted Call on OPEC + Stock ch.9

31.4 29.1
31.3 28.8

29.4 29.7 31.0 31.0 30.3

29.1 28.4 30.1 30.7 29.6

30.4 30.1 31.3 30.5 30.6

30.2 29.1 30.8 30.1 30.1

30.4 29.8 31.1 30.9 30.6

30.0 29.4 30.6 30.5 30.1

1 Measured as deliveries from refineries and primary stocks, comprises inland deliveries, international marine bunkers, refinery fuel, crude for direct burning,
oil from non-conventional sources and other sources of supply.
2 Other Asia includes Indonesia throughout. Latin America excludes Ecuador throughout. Africa excludes Angola throughout.
Total Non-OPEC excludes all countries that were members of OPEC at 1 January 2009. Non-OPEC Historical Composition excludes countries that were OPEC members at that point in time.
Total OPEC comprises all countries which were OPEC members at 1 January 2009. OPEC Historical Composition comprises countries which were OPEC members at that point in time.
3 Net volumetric gains and losses in the refining process and marine transportation losses.
4 As of the July 2010 OMR, Global Biofuels comprise all world biofuel production including fuel ethanol from the US and Brazil.
5 As of the March 2006 OMR, Venezuelan Orinoco heavy crude production is included within Venezuelan crude estimates. Orimulsion fuel remains within the OPEC NGL and
non-conventional category, but Orimulsion production reportedly ceased from January 2007.
6 Comprises crude oil, condensates, NGLs, oil from non-conventional sources and other sources of supply.
7 Includes changes in non-reported stocks in OECD and non-OECD areas.
8 Equals the arithmetic difference between total demand minus total non-OPEC supply minus OPEC NGLs.
9 Equals the "Call on OPEC + Stock Ch." with "Miscellaneous to balance" added for historical periods and with an average of "Miscellaneous to balance" for the most recent 8 quarters added for forecast periods.

13 S EPTEMBER 2011

57

T ABLES

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Table 1A

Table 1a - WORLD
World Oil
ChangesFROM
fromLAST
LastMONTH'S
MonthsTABLE
Table11
OILSupply
SUPPLYand
AND Demand:
DEMAND: CHANGES
(million barrels per day)

2008 2009

1Q10 2Q10 3Q10 4Q10 2010

1Q11 2Q11 3Q11 4Q11 2011

1Q12 2Q12 3Q12 4Q12 2012

OECD DEMAND
North America
Europe
Pacific

0.1
-

0.1
-0.2
0.1

-0.1
-0.1
-

-0.1
-

-0.2
-0.1
-

-0.1
-0.1
-

-0.1
-0.1
-

-0.2
-0.1
-

-0.1
-0.1
-

Total OECD

0.1

-0.3

-0.3

-0.2

-0.1

-0.3

-0.2

FSU
Europe
China
Other Asia
Latin America
Middle East
Africa

-0.1
-

-0.1
-

-0.1

-0.1
-0.1
-0.1

-0.1
-

-0.1
-0.1

-0.1
-

-0.1
-

-0.1
-0.1
-

-0.1
-0.1
-

-0.1
-

Total Non-OECD

-0.1

-0.1

-0.1

-0.1

-0.3

-0.2

-0.2

-0.1

-0.1

-0.2

-0.2

-0.2

Total Demand

-0.1

-0.1

-0.1

-0.3

-0.5

-0.2

-0.4

-0.3

-0.4

-0.5

-0.4

North America
Europe
Pacific

-0.1
-

Total OECD

Total Non-OECD

-0.1

-0.1
-0.1
-0.3

-0.1
-0.2

-0.1
-0.1

-0.1

-0.1

-0.1

-0.1

-0.1

Processing Gains

Global Biofuels

-0.1

-0.1

Total Non-OPEC

-0.1

-0.4

-0.3

-0.2

-0.1

-0.2

-0.2

-0.2

-0.2

Non-OPEC: historical composition

-0.1

-0.4

-0.3

-0.2

-0.1

-0.2

-0.2

-0.2

-0.2

Crude
NGLs

0.1
-

Total OPEC

0.1

OPEC: historical composition

0.1

Total Supply

STOCK CHANGES AND MISCELLANEOUS

REPORTED OECD
Industry
Government
-

Total

Floating Storage/Oil in Transit

Miscellaneous to balance

0.1

0.1

0.1

0.1

Total Stock Ch. & Misc

0.1

0.1

0.1

0.1

-0.1
-

-0.1
-

-0.1
-

-0.1
-

0.1
0.1

0.1
0.2

-0.2
-0.2

-0.3
-0.3

-0.1
-0.1

-0.2
-0.2

-0.4
-0.3

-0.2
-0.2

NON-OECD DEMAND

OECD SUPPLY

NON-OECD SUPPLY
FSU
Europe
China
Other Asia
Latin America
Middle East
Africa

OPEC

Memo items:
Call on OPEC crude + Stock ch.
Adjusted Call on OPEC + Stock ch.

When submitting their monthly oil statistics, OECD Member countries periodically update data for prior periods. Similar updates to non-OECD data can occur.

58

13 S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

T ABLES

Table 2

Table 2 - Summary of Global Oil Demand

SUMMARY OF GLOBAL OIL DEMAND

2009

1Q10

2Q10

3Q10

4Q10

2010

1Q11

2Q11

3Q11

4Q11

2011

1Q12

2Q12

3Q12

4Q12

2012

Demand (mb/d)
North America
Europe
Pacific
Total OECD
Asia
Middle East
Latin America
FSU
Africa
Europe
Total Non-OECD
World

23.29
14.66
7.68
45.64
18.19
7.49
5.99
4.18
3.33
0.71
39.90
85.54

23.41
14.31
8.23
45.95
18.98
7.39
6.05
4.39
3.32
0.68
40.80
86.75

23.70
14.25
7.34
45.29
19.60
7.80
6.29
4.34
3.43
0.68
42.13
87.42

24.07
14.92
7.62
46.62
19.05
8.25
6.46
4.58
3.37
0.69
42.39
89.01

23.85
14.82
8.07
46.74
20.20
7.68
6.39
4.59
3.42
0.71
42.99
89.73

23.76
14.58
7.81
46.15
19.46
7.78
6.30
4.48
3.39
0.69
42.09
88.24

23.76
14.18
8.35
46.29
20.22
7.62
6.27
4.47
3.40
0.68
42.66
88.95

23.31
14.13
7.12
44.55
20.36
8.03
6.46
4.64
3.32
0.70
43.50
88.06

23.69
14.52
7.72
45.93
19.96
8.54
6.61
4.79
3.31
0.70
43.90
89.83

23.50
14.53
8.35
46.38
20.68
7.84
6.54
4.69
3.42
0.71
43.87
90.25

23.57
14.34
7.88
45.79
20.31
8.01
6.47
4.65
3.36
0.70
43.49
89.28

23.53
14.08
8.58
46.18
21.01
7.86
6.49
4.61
3.52
0.70
44.20
90.38

23.14
13.92
7.38
44.44
21.29
8.30
6.70
4.62
3.55
0.72
45.19
89.63

23.58
14.50
7.52
45.60
20.85
8.83
6.86
4.85
3.53
0.72
45.63
91.23

23.46
14.45
8.05
45.97
21.54
8.13
6.78
4.79
3.59
0.73
45.55
91.52

23.43
14.24
7.88
45.55
21.17
8.28
6.71
4.72
3.55
0.72
45.14
90.69

of which: US50
Europe 5*
China
Japan
India
Russia
Brazil
Saudi Arabia
Canada
Korea
Mexico
Iran
Total

18.77
8.98
8.06
4.39
3.26
3.03
2.54
2.47
2.16
2.19
2.07
2.11
60.03

18.87
8.87
8.63
4.82
3.38
3.16
2.60
2.33
2.15
2.31
2.07
2.10
61.31

19.15
8.75
9.06
4.07
3.45
3.17
2.71
2.73
2.17
2.18
2.10
2.08
61.62

19.47
9.15
8.92
4.36
3.13
3.41
2.82
3.02
2.26
2.16
2.05
2.08
62.84

19.23
9.01
9.66
4.57
3.38
3.36
2.80
2.54
2.25
2.35
2.07
2.09
63.31

19.18
8.95
9.07
4.45
3.34
3.28
2.73
2.66
2.21
2.25
2.07
2.09
62.28

19.17
8.70
9.53
4.86
3.50
3.21
2.68
2.47
2.25
2.36
2.03
2.09
62.83

18.82
8.57
9.52
3.92
3.57
3.43
2.75
2.84
2.17
2.04
2.05
2.05
61.73

19.15
8.83
9.50
4.42
3.25
3.58
2.85
3.18
2.22
2.16
2.03
2.04
63.22

18.91
8.81
9.83
4.87
3.48
3.44
2.86
2.65
2.23
2.31
2.06
2.02
63.47

19.01
8.73
9.60
4.52
3.45
3.42
2.79
2.78
2.22
2.22
2.04
2.05
62.81

18.96
8.62
9.95
5.10
3.65
3.31
2.76
2.59
2.22
2.33
2.03
2.10
63.63

18.67
8.43
10.08
4.14
3.72
3.38
2.85
2.96
2.14
2.09
2.04
2.08
62.58

19.06
8.78
10.02
4.26
3.37
3.61
2.94
3.30
2.20
2.12
2.03
2.07
63.77

18.89
8.74
10.28
4.58
3.63
3.50
2.95
2.77
2.21
2.29
2.05
2.04
63.95

18.90
8.64
10.08
4.52
3.59
3.45
2.88
2.91
2.19
2.21
2.04
2.07
63.48

% of World

70.2%

70.7%

70.5%

70.6%

70.6%

70.6%

70.6%

70.1%

70.4%

70.3%

70.4%

70.4%

69.8%

69.9%

69.9%

70.0%

1.5
-0.9
1.5
0.7
6.6
3.2
3.6
1.8
2.2
0.3
4.6
2.5

-1.6
-0.9
-3.1
-1.6
3.9
3.0
2.6
6.8
-3.0
2.3
3.2
0.7

-1.6
-2.7
1.2
-1.5
4.8
3.4
2.4
4.5
-1.7
1.6
3.6
0.9

-1.5
-2.0
3.4
-0.8
2.4
2.0
2.4
2.1
0.0
0.4
2.0
0.6

-0.8
-1.7
0.9
-0.8
4.4
2.9
2.7
3.8
-0.7
1.1
3.3
1.2

-1.0
-0.7
2.8
-0.2
3.9
3.1
3.6
3.1
3.5
3.3
3.6
1.6

-0.7
-1.4
3.7
-0.3
4.6
3.4
3.8
-0.4
6.9
3.1
3.9
1.8

-0.5
-0.1
-2.5
-0.7
4.5
3.4
3.7
1.4
6.7
2.8
3.9
1.6

-0.2
-0.5
-3.5
-0.9
4.2
3.7
3.7
2.1
4.9
2.7
3.8
1.4

-0.6
-0.7
0.0
-0.5
4.3
3.4
3.7
1.5
5.5
3.0
3.8
1.6

0.35
-0.13
0.12
0.34
1.25
0.24
0.22
0.08
0.07
0.00
1.86
2.20

-0.38
-0.13
-0.22
-0.74
0.77
0.23
0.16
0.29
-0.10
0.02
1.37
0.63

-0.38
-0.40
0.09
-0.69
0.91
0.28
0.16
0.21
-0.06
0.01
1.51
0.82

-0.35
-0.30
0.28
-0.37
0.48
0.15
0.15
0.10
0.00
0.00
0.88
0.51

-0.19
-0.24
0.07
-0.37
0.85
0.23
0.17
0.17
-0.02
0.01
1.40
1.04

-0.23
-0.10
0.23
-0.10
0.79
0.24
0.22
0.14
0.12
0.02
1.53
1.43

-0.17
-0.20
0.26
-0.11
0.93
0.28
0.25
-0.02
0.23
0.02
1.69
1.57

-0.11
-0.02
-0.20
-0.33
0.89
0.29
0.24
0.07
0.22
0.02
1.73
1.40

-0.04
-0.07
-0.29
-0.40
0.86
0.29
0.24
0.10
0.17
0.02
1.67
1.27

-0.14
-0.10
0.00
-0.24
0.87
0.27
0.24
0.07
0.18
0.02
1.65
1.42

0.00
-0.03
0.00
-0.03
-0.05
0.01
0.00
-0.01
-0.02
0.00
-0.07
-0.11

0.12
0.00
0.02
0.15
0.01
0.00
-0.02
-0.01
-0.08
0.00
-0.11
0.03

0.13
-0.17
0.09
0.05
-0.17
-0.01
-0.04
-0.01
-0.08
-0.01
-0.31
-0.26

-0.11
-0.14
0.00
-0.25
-0.15
0.00
-0.04
-0.01
-0.02
-0.01
-0.23
-0.49

0.03
-0.09
0.03
-0.02
-0.09
0.00
-0.02
-0.01
-0.05
0.00
-0.18
-0.21

-0.17
-0.09
-0.01
-0.26
-0.12
0.01
-0.01
-0.01
0.01
-0.01
-0.13
-0.39

-0.07
-0.10
0.00
-0.18
-0.09
0.00
-0.01
-0.01
0.01
-0.01
-0.12
-0.29

-0.05
-0.12
0.04
-0.13
-0.13
-0.02
-0.04
-0.04
0.00
-0.01
-0.24
-0.37

-0.18
-0.13
-0.01
-0.32
-0.13
-0.01
-0.05
-0.02
0.01
-0.01
-0.21
-0.53

-0.12
-0.11
0.01
-0.22
-0.12
0.00
-0.03
-0.02
0.01
-0.01
-0.17
-0.40

-0.08

0.06

-0.20

-0.42

-0.16

-0.29

-0.33

-0.11

-0.04

-0.19

Annual Change (% per annum)

North America
-3.7
-0.1
3.3
3.4
1.3
2.0
Europe
-4.7
-5.2
-1.3
2.2
2.0
-0.6
Pacific
-4.6
1.2
0.4
4.7
0.6
1.7
Total OECD
-4.2
-1.5
1.3
3.3
1.4
1.1
Asia
4.3
12.0
6.8
3.1
6.5
7.0
Middle East
4.0
5.0
3.4
2.9
4.3
3.9
Latin America
0.0
4.6
5.1
6.0
4.4
5.0
FSU
-1.0
8.4
6.7
5.5
7.5
7.0
Africa
1.6
-1.9
1.8
2.0
5.1
1.7
Europe
-6.1
-6.9
-6.4
-3.2
1.8
-3.7
Total Non-OECD
2.6
7.6
5.3
3.6
5.7
5.5
World
-1.1
2.6
3.2
3.4
3.4
3.2
Annual Change (mb/d)
North America
-0.89
-0.01
0.76
0.80
0.31
0.47
Europe
-0.73
-0.78
-0.18
0.33
0.29
-0.08
Pacific
-0.37
0.10
0.03
0.34
0.05
0.13
Total OECD
-1.98
-0.70
0.60
1.47
0.65
0.51
Asia
0.75
2.03
1.25
0.58
1.24
1.27
Middle East
0.28
0.35
0.26
0.24
0.32
0.29
Latin America
0.00
0.26
0.31
0.37
0.27
0.30
FSU
-0.04
0.34
0.27
0.24
0.32
0.29
Africa
0.05
-0.06
0.06
0.07
0.17
0.06
Europe
-0.05
-0.05
-0.05
-0.02
0.01
-0.03
Total Non-OECD
1.00
2.87
2.10
1.46
2.32
2.19
World
-0.98
2.17
2.71
2.94
2.97
2.70
Revisions to Oil Demand from Last Month's Report (mb/d)
North America
0.00
0.00
0.00
0.00
0.00
0.00
Europe
0.00
0.00
0.00
0.00
0.00
0.00
Pacific
0.00
0.00
0.00
0.00
0.00
0.00
Total OECD
0.00
0.00
0.00
0.00
0.00
0.00
Asia
0.00
-0.03
-0.03
-0.06
-0.07
-0.05
Middle East
0.00
0.01
0.01
0.01
0.01
0.01
Latin America
0.00
0.00
0.00
0.00
0.00
0.00
FSU
0.00
0.00
0.00
0.00
0.00
0.00
Africa
0.00
0.00
0.00
0.00
0.00
0.00
Europe
0.00
0.00
0.00
0.00
0.00
0.00
Total Non-OECD
0.00
-0.02
-0.02
-0.06
-0.06
-0.04
World
0.00
-0.02
-0.02
-0.06
-0.06
-0.04
Revisions to Oil Demand Growth from Last Month's Report (mb/d)
World
0.01
-0.01
-0.02
-0.09
-0.06
-0.05
* France, Germany, Italy, Spain and UK

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Table 2a
Table 2a - OECD Regional Oil Demand
OECD REGIONAL OIL DEMAND1

(million barrels per day)

Latest month vs.

2009

2010

3Q10

4Q10

1Q11

2Q11

Apr 11 May 11 Jun 11

LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products

2.83
0.31
10.56
1.61
4.61
0.92
2.45

2.95
0.37
10.57
1.65
4.82
0.93
2.46

2.76
0.39
10.83
1.70
4.76
0.91
2.71

3.12
0.33
10.51
1.63
5.01
0.89
2.36

3.31
0.36
10.14
1.60
5.04
0.97
2.34

2.72
0.35
10.45
1.68
4.77
0.88
2.46

2.71
0.34
10.35
1.65
4.66
0.93
2.43

2.75
0.33
10.36
1.63
4.69
0.84
2.30

Total

23.29

23.76

24.07

23.85

23.76

23.31

23.07

0.96
1.18
2.31
1.25
6.04
1.44
1.50

0.96
1.26
2.21
1.27
6.13
1.27
1.47

0.89
1.26
2.35
1.37
6.14
1.28
1.64

0.96
1.27
2.14
1.26
6.43
1.30
1.46

1.04
1.27
2.02
1.20
6.04
1.28
1.32

0.98
1.17
2.18
1.27
5.73
1.22
1.57

14.66

14.58

14.92

14.82

14.18

LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products

0.86
1.62
1.55
0.85
1.61
0.76
0.44

0.84
1.68
1.57
0.87
1.62
0.74
0.49

0.80
1.63
1.65
0.65
1.57
0.75
0.58

0.83
1.75
1.59
0.98
1.70
0.73
0.48

Total

7.68

7.81

7.62

LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products

4.65
3.11
14.41
3.70
12.25
3.13
4.39

4.76
3.31
14.35
3.80
12.57
2.94
4.42

Total

45.64

46.15

May 11

Jun 10

2.71
0.39
10.66
1.75
4.95
0.87
2.65

-0.04
0.06
0.30
0.13
0.26
0.03
0.35

0.01
-0.02
-0.27
-0.01
0.19
-0.06
-0.08

22.90

23.98

1.09

-0.24

1.00
1.26
2.19
1.21
5.66
1.21
1.42

0.93
1.13
2.16
1.26
5.73
1.21
1.60

1.00
1.13
2.20
1.34
5.80
1.24
1.70

0.07
0.00
0.04
0.08
0.07
0.03
0.10

0.07
-0.09
-0.12
0.03
-0.21
0.03
0.04

14.13

13.95

14.02

14.41

0.38

-0.25

0.88
1.78
1.51
1.18
1.67
0.80
0.54

0.81
1.55
1.47
0.64
1.53
0.65
0.48

0.89
1.46
1.43
0.77
1.54
0.64
0.42

0.78
1.59
1.48
0.56
1.49
0.60
0.47

0.75
1.60
1.49
0.58
1.58
0.70
0.54

-0.04
0.00
0.01
0.02
0.09
0.10
0.07

-0.05
-0.01
-0.01
-0.06
0.01
0.03
0.06

8.07

8.35

7.12

7.14

6.98

7.23

0.26

-0.03

4.45
3.28
14.83
3.73
12.47
2.94
4.92

4.91
3.36
14.24
3.88
13.14
2.92
4.30

5.23
3.41
13.67
3.98
12.75
3.06
4.19

4.51
3.07
14.10
3.58
12.03
2.75
4.51

4.60
3.05
13.96
3.64
11.86
2.78
4.27

4.47
3.05
14.00
3.44
11.91
2.66
4.37

4.46
3.11
14.35
3.67
12.33
2.81
4.89

-0.01
0.06
0.36
0.23
0.42
0.16
0.52

0.03
-0.11
-0.40
-0.04
-0.01
0.00
0.02

46.62

46.74

46.29

44.55

44.16

43.90

45.62

1.73

-0.52

North America

Europe
LPG&Ethane
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil/Diesel Oil
Residual Fuel Oil
Other Products
Total

Pacific

OECD

1 Demand, measured as deliveries from refineries and primary stocks, comprises inland deliveries, international bunkers and refinery fuel. It includes crude for direct burning, oil from
non-conventional sources and other sources of supply. Jet/kerosene comprises jet kerosene and non-aviation kerosene. Gasoil comprises diesel, light heating oil and other gasoils.
North America comprises US 50 states, US territories, Mexico and Canada.
2 Latest official OECD submissions (MOS).

60

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I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

T ABLES

Table 2b

Table 2b - OECD Oil Demand

and % Growth in Demand in Selected OECD Countries
OIL DEMAND IN SELECTED OECD COUNTRIES1
(million barrels per day)

Latest month vs.

2009

2010

3Q10

4Q10

1Q11

2Q11

Apr 11 May 11 Jun 11

May 11

Jun 10

United States3
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Gasoil
Residual Fuel Oil
Other Products
Total

2.05
2.17
0.25
0.26
9.00
8.99
1.41
1.45
3.63
3.80
0.51
0.54
1.92
1.97
18.77 19.18

2.03
0.27
9.22
1.49
3.75
0.53
2.18
19.47

2.32
0.22
8.92
1.44
3.94
0.52
1.87
19.23

2.47
0.27
8.61
1.40
3.95
0.61
1.86
19.17

1.96
0.27
8.87
1.49
3.75
0.51
1.97
18.82

1.92
0.25
8.78
1.47
3.70
0.60
1.98
18.69

2.00
0.25
8.78
1.44
3.66
0.47
1.83
18.43

1.96
0.29
9.05
1.56
3.90
0.47
2.12
19.35

-0.04
0.04
0.27
0.12
0.25
0.01
0.28
0.92

0.02
0.01
-0.26
0.00
0.16
-0.03
-0.09
-0.19

Japan
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total

0.50
0.72
0.99
0.55
0.43
0.42
0.41
0.39
4.39

0.48
0.77
1.00
0.55
0.41
0.43
0.40
0.41
4.45

0.44
0.73
1.08
0.36
0.42
0.38
0.43
0.51
4.36

0.47
0.81
1.00
0.62
0.43
0.44
0.39
0.40
4.57

0.54
0.79
0.95
0.80
0.41
0.48
0.42
0.47
4.86

0.50
0.65
0.92
0.36
0.39
0.36
0.36
0.39
3.92

0.58
0.63
0.88
0.46
0.39
0.40
0.34
0.32
4.01

0.49
0.67
0.93
0.30
0.35
0.33
0.36
0.38
3.80

0.43
0.66
0.95
0.31
0.41
0.35
0.40
0.46
3.96

-0.06
0.00
0.02
0.01
0.06
0.02
0.04
0.08
0.16

-0.02
-0.02
-0.01
-0.05
0.02
-0.04
0.03
0.07
-0.03

0.10
0.36
0.47
0.19
0.64
0.42
0.16
0.11
2.45

0.10
0.41
0.46
0.18
0.67
0.43
0.15
0.09
2.49

0.11
0.41
0.48
0.20
0.71
0.45
0.16
0.12
2.65

0.09
0.41
0.45
0.18
0.69
0.47
0.16
0.09
2.53

0.10
0.44
0.43
0.17
0.63
0.37
0.16
0.05
2.35

0.10
0.40
0.47
0.19
0.67
0.23
0.14
0.12
2.34

0.11
0.42
0.46
0.19
0.67
0.18
0.15
0.10
2.28

0.09
0.40
0.49
0.19
0.71
0.27
0.14
0.13
2.43

0.10
0.38
0.46
0.19
0.64
0.25
0.13
0.13
2.29

0.01
-0.02
-0.03
0.00
-0.06
-0.02
-0.01
-0.01
-0.14

0.00
-0.03
-0.02
-0.02
-0.05
-0.12
-0.01
0.00
-0.24

0.10
0.10
0.25
0.09
0.49
0.13
0.18
0.20
1.54

0.11
0.12
0.24
0.10
0.49
0.12
0.13
0.23
1.53

0.09
0.12
0.26
0.11
0.50
0.11
0.13
0.26
1.58

0.11
0.11
0.24
0.09
0.50
0.14
0.12
0.25
1.56

0.12
0.11
0.22
0.09
0.47
0.11
0.10
0.21
1.43

0.08
0.10
0.24
0.10
0.51
0.09
0.11
0.24
1.47

0.09
0.12
0.24
0.09
0.50
0.08
0.10
0.23
1.46

0.08
0.09
0.23
0.09
0.50
0.09
0.10
0.25
1.43

0.08
0.09
0.24
0.11
0.53
0.09
0.13
0.25
1.51

0.00
0.00
0.01
0.02
0.03
0.00
0.03
0.00
0.08

-0.01
-0.04
-0.02
0.01
0.01
-0.01
0.00
0.02
-0.05

0.12
0.13
0.20
0.15
0.67
0.32
0.10
0.18
1.87

0.15
0.13
0.19
0.15
0.69
0.30
0.09
0.17
1.86

0.13
0.12
0.20
0.16
0.71
0.27
0.08
0.19
1.87

0.17
0.10
0.18
0.14
0.69
0.34
0.09
0.15
1.86

0.17
0.13
0.17
0.14
0.69
0.35
0.08
0.13
1.86

0.12
0.14
0.20
0.15
0.71
0.19
0.08
0.19
1.79

0.13
0.14
0.20
0.15
0.71
0.20
0.09
0.17
1.78

0.12
0.15
0.19
0.15
0.70
0.18
0.08
0.19
1.77

0.12
0.14
0.20
0.15
0.72
0.20
0.08
0.21
1.82

-0.01
-0.01
0.01
0.00
0.02
0.02
0.00
0.02
0.05

-0.01
0.02
0.00
-0.01
-0.01
-0.01
-0.01
-0.01
-0.05

0.15
0.02
0.37
0.33
0.43
0.12
0.08
0.14
1.65

0.14
0.03
0.35
0.33
0.45
0.12
0.06
0.14
1.62

0.12
0.03
0.36
0.33
0.45
0.14
0.06
0.15
1.63

0.13
0.02
0.34
0.34
0.44
0.12
0.07
0.15
1.60

0.14
0.03
0.34
0.34
0.45
0.11
0.07
0.15
1.62

0.15
0.03
0.34
0.32
0.45
0.11
0.06
0.16
1.61

0.17
0.03
0.35
0.31
0.43
0.11
0.07
0.16
1.61

0.13
0.02
0.34
0.30
0.45
0.10
0.06
0.15
1.55

0.16
0.03
0.34
0.35
0.46
0.12
0.05
0.17
1.68

0.03
0.01
0.01
0.05
0.01
0.02
-0.01
0.02
0.13

0.02
0.02
-0.01
0.04
0.01
0.00
0.02
0.01
0.09

0.35
0.05
0.73
0.11
0.23
0.28
0.10
0.31
2.16

0.35
0.08
0.73
0.11
0.22
0.31
0.10
0.30
2.21

0.33
0.09
0.77
0.12
0.22
0.31
0.09
0.34
2.26

0.36
0.08
0.73
0.11
0.23
0.34
0.11
0.30
2.25

0.39
0.09
0.69
0.11
0.22
0.36
0.11
0.28
2.25

0.36
0.08
0.74
0.10
0.23
0.28
0.10
0.29
2.17

0.38
0.09
0.73
0.10
0.21
0.27
0.08
0.26
2.12

0.35
0.08
0.74
0.10
0.23
0.28
0.09
0.28
2.14

0.35
0.09
0.75
0.10
0.24
0.27
0.11
0.33
2.25

0.00
0.01
0.02
0.01
0.01
-0.01
0.02
0.05
0.11

-0.01
0.00
0.00
-0.01
0.00
0.00
0.00
0.00
-0.01

Germany
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total

Italy
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total

France
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total

United Kingdom
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total

Canada
LPG
Naphtha
Motor Gasoline
Jet/Kerosene
Diesel
Other Gasoil
Residual Fuel Oil
Other Products
Total

1 Demand, measured as deliveries from refineries and primary stocks, comprises inland deliveries, international bunkers and refinery fuel. It includes crude for direct burning, oil from
non-conventional sources and other sources of supply. Jet/kerosene comprises jet kerosene and non-aviation kerosene. Gasoil comprises diesel, light heating oil and other gasoils.
2 Latest official OECD submissions (MOS).
3 US figures exclude US territories.

13 S EPTEMBER 2011

61

T ABLES

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Table 3

Table 3 - World Oil Production

WORLD OIL PRODUCTION
(million barrels per day)
3a - Oil Supply In OECD Countries
2010

2011

2012

1Q11

2Q11

8.55
3.63
2.66
2.48
2.08
0.56
0.82
1.61
2.14
1.13
1.27
0.50
2.54

8.90
3.65
2.67
2.48
2.15
0.59
0.82
1.55
2.25
0.12
1.26
0.50
2.52

29.97
5.79

29.45
5.80

3Q11

4Q11

1Q12

Jun 11

Jul 11

Aug 11

9.50
3.65
2.72
2.50
2.19
0.60
0.82
1.49
2.28
0.08
1.26
0.50
2.62

9.40
3.53
2.65
2.50
2.21
0.60
0.82
1.67
2.26
0.06
1.28
0.49
2.63

9.50
3.51
2.68
2.53
2.23
0.60
0.82
1.69
2.32
0.00
1.28
0.49
2.61

30.21
5.80

30.09
5.93

30.26
5.93

OPEC
Crude Oil
Saudi Arabia
Iran
Iraq
UAE
Kuwait
Neutral Zone
Qatar
Angola
Nigeria
Libya
Algeria
Ecuador
Venezuela
Total Crude Oil6
Total NGLs1,6
6

8.13
3.70
2.36
2.31
2.03
0.53
0.80
1.73
2.08
1.55
1.25
0.47
2.53
29.49
5.35

5.88

6.30

5.93

6.00

6.15

Total OPEC

34.83

35.76

35.24

36.00

36.02

36.19

OPEC: Historical Composition6

34.83

35.76

35.24

36.00

36.02

36.19

NON-OPEC

OECD
North America
United States5
Mexico
Canada
Europe
UK
Norway
Others
Pacific
Australia
Others

14.10
7.77
2.96
3.37
4.18
1.37
2.17
0.64
0.61
0.51
0.10

14.23
7.87
2.92
3.44
4.03
1.24
2.12
0.67
0.56
0.47
0.09

14.38
7.92
2.86
3.60
4.04
1.26
2.13
0.64
0.68
0.60
0.08

14.36
7.84
2.97
3.54
4.12
1.26
2.18
0.67
0.52
0.43
0.09

14.21
8.02
2.96
3.23
3.82
1.16
1.98
0.67
0.50
0.42
0.08

13.99
7.70
2.89
3.40
3.86
1.13
2.05
0.68
0.58
0.50
0.08

14.36
7.91
2.87
3.58
4.30
1.38
2.25
0.67
0.62
0.54
0.08

14.55
7.94
2.90
3.71
4.22
1.35
2.21
0.66
0.66
0.57
0.09

14.06
7.96
2.95
3.16
3.68
1.09
1.94
0.66
0.50
0.42
0.08

13.95
7.63
2.93
3.38
3.81
1.08
2.05
0.68
0.53
0.45
0.08

14.15
7.82
2.91
3.42
3.76
1.03
2.05
0.68
0.60
0.52
0.08

Total OECD

18.89

18.81

19.10

18.99

18.53

18.43

19.28

19.43

18.24

18.28

18.51

13.55
10.45
3.10

13.62
10.57
3.06

13.71
10.61
3.10

13.64
10.52
3.12

13.56
10.55
3.02

13.59
10.61
2.98

13.70
10.59
3.11

13.71
10.58
3.13

13.56
10.51
3.06

13.49
10.57
2.91

13.62
10.60
3.02

Asia
China
Malaysia
India
Indonesia
Others

7.80
4.10
0.72
0.86
0.97
1.15

7.71
4.18
0.62
0.90
0.91
1.10

7.77
4.29
0.59
0.93
0.86
1.10

7.86
4.21
0.70
0.91
0.93
1.11

7.65
4.17
0.61
0.89
0.90
1.07

7.66
4.18
0.58
0.90
0.91
1.10

7.69
4.17
0.60
0.92
0.89
1.11

7.80
4.31
0.60
0.92
0.87
1.11

7.67
4.21
0.62
0.89
0.89
1.06

7.58
4.11
0.57
0.90
0.92
1.08

7.74
4.26
0.57
0.90
0.91
1.11

Europe

0.14

0.14

0.13

0.14

0.14

0.14

0.14

0.14

0.14

0.14

0.14

Latin America
Brazil5
Argentina
Colombia
Others

4.07
2.14
0.69
0.79
0.45

4.29
2.25
0.67
0.93
0.44

4.56
2.42
0.68
1.02
0.44

4.18
2.18
0.69
0.87
0.44

4.15
2.18
0.61
0.92
0.44

4.34
2.27
0.68
0.95
0.44

4.47
2.36
0.68
0.98
0.44

4.55
2.42
0.68
1.00
0.44

4.23
2.23
0.63
0.93
0.44

4.22
2.20
0.65
0.93
0.44

4.38
2.28
0.69
0.96
0.45

1.72
0.86
0.39
0.28
0.19

1.67
0.89
0.37
0.21
0.20

1.72
0.93
0.34
0.25
0.19

1.73
0.89
0.38
0.26
0.20

1.60
0.87
0.38
0.14
0.20

1.64
0.90
0.36
0.18
0.20

1.71
0.91
0.36
0.25
0.20

1.73
0.93
0.35
0.26
0.20

1.61
0.88
0.38
0.15
0.20

1.64
0.90
0.36
0.18
0.20

1.68
0.90
0.37
0.21
0.20

2.52
0.70
0.25
1.58

2.53
0.69
0.24
1.60

2.56
0.68
0.25
1.63

2.55
0.70
0.25
1.60

2.51
0.69
0.23
1.58

2.53
0.69
0.24
1.60

2.54
0.68
0.25
1.61

2.55
0.68
0.24
1.62

2.54
0.69
0.25
1.60

2.53
0.69
0.24
1.60

2.53
0.69
0.24
1.61

Total Non-OECD

29.80

29.96

30.45

30.09

29.61

29.90

30.25

30.48

29.76

29.60

30.09

Processing Gains4

2.10

2.17

2.26

2.16

2.14

2.14

2.23

2.28

2.14

2.14

2.14

Global Biofuels5

1.82

1.86

2.02

1.48

1.89

2.14

1.93

1.61

2.07

2.07

2.17

TOTAL NON-OPEC6

52.61

52.80

53.83

52.73

52.17

52.61

53.70

53.79

52.21

52.09

52.90

Non-OPEC: Historical Composition6

52.61

52.80

53.83

52.73

52.17

52.61

53.70

53.79

52.21

52.09

52.90

TOTAL SUPPLY

87.45

88.49

87.42

88.22

88.11

89.09

NON-OECD
Former USSR
Russia
Others

Middle East
Oman
Syria
Yemen
Others

Africa
Egypt
Gabon
Others

1 Includes condensates reported by OPEC countries, oil from non-conventional sources, e.g. Venezuelan Orimulsion (but not Orinoco extra-heavy oil),
and non-oil inputs to Saudi Arabian MTBE. Orimulsion production reportedly ceased from January 2007.
2 Comprises crude oil, condensates, NGLs and oil from non-conventional sources
3 Includes small amounts of production from Israel, Jordan and Bahrain.
4 Net volumetric gains and losses in refining and marine transportation losses.
5 As of the July 2010 OMR, Global Biofuels comprise all world biofuel production including fuel ethanol from the US and Brazil.
6 Total OPEC comprises all countries which were OPEC members at 1 January 2009. OPEC Historical Composition comprises countries which were OPEC members at that point in time.
Total Non-OPEC excludes all countries that were OPEC members at 1 January 2009. Non-OPEC Historical Composition excludes countries that were OPEC members at that point in time.

62

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I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

T ABLES

Table 4
Table 4 - OECD Industry Stocks and
Quarterly Stock Changes/OECD Government1
OECD
AND QUARTERLY STOCK CHANGES
Controlled Stocks
andINDUSTRY
QuarterlySTOCKS
Stock Changes
Industry Stocks on Land in Selected Countries
2
2

North America
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total

Europe
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total

Pacific
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total

Total OECD
Crude
Motor Gasoline
Middle Distillate
Residual Fuel Oil
3
Total Products
Total

RECENT MONTHLY STOCKS

PRIOR YEARS' STOCKS

in Million Barrels

in Million Barrels

STOCK CHANGES
in mb/d

Mar2011

Apr2011

May2011

Jun2011

Jul2011*

Jul2008

Jul2009

Jul2010

3Q2010

4Q2010

1Q2011

2Q2011

497.4
249.5
217.4
44.9
653.1

510.9
238.9
212.4
47.7
649.4

513.2
247.5
213.9
44.5
669.4

497.7
248.1
213.0
43.8
677.7

493.5
250.6
224.2
43.4
704.8

418.9
234.6
201.6
43.6
659.7

471.1
241.3
243.3
42.6
737.5

496.8
252.2
244.5
49.4
736.5

0.02
0.04
0.14
-0.02
0.23

-0.30
0.02
-0.07
0.01
-0.32

0.27
-0.03
-0.24
-0.05
-0.58

0.00
-0.02
-0.05
-0.01
0.27

1294.9

1310.9

1338.5

1335.2

1356.4

1235.4

1372.7

1391.7

0.33

-0.77

-0.37

0.44

322.9
100.5
285.6
67.5
566.5

313.7
95.4
284.0
68.7
560.4

319.6
92.2
283.7
68.6
558.2

322.1
89.8
274.8
65.2
545.8

310.4
88.9
273.2
65.0
543.4

344.4
99.8
261.6
80.8
554.2

341.7
91.5
293.4
66.6
558.3

334.4
94.6
286.6
72.7
565.0

-0.23
-0.02
-0.10
-0.01
-0.12

0.04
0.02
-0.01
-0.09
-0.07

0.00
0.04
0.09
0.00
0.12

-0.01
-0.12
-0.12
-0.03
-0.23

954.6

940.0

944.5

936.5

922.2

974.5

970.9

967.6

-0.39

0.02

0.07

-0.20

158.4
23.7
54.2
20.7
154.9

166.7
26.8
60.3
22.0
167.5

161.2
24.8
63.8
21.3
169.6

159.5
25.0
66.8
21.3
171.4

161.3
24.6
66.7
21.3
175.7

170.3
22.9
66.0
22.1
178.7

170.5
23.7
67.4
19.1
170.2

170.6
24.4
59.1
20.1
169.2

-0.12
-0.03
0.09
0.01
0.11

0.03
-0.01
-0.07
-0.03
-0.16

0.00
0.01
-0.06
0.02
-0.09

0.01
0.01
0.14
0.01
0.18

381.5

408.4

405.5

404.9

408.7

423.7

406.7

409.4

-0.03

-0.13

-0.10

0.26

978.7
373.7
557.2
133.1
1374.5

991.3
361.1
556.7
138.4
1377.3

993.9
364.5
561.4
134.4
1397.1

979.3
362.8
554.6
130.4
1394.9

965.3
364.1
564.1
129.6
1423.9

933.5
357.3
529.1
146.5
1392.6

983.3
356.5
604.1
128.4
1465.9

1001.8
371.3
590.3
142.2
1470.7

-0.34
0.00
0.13
-0.02
0.21

-0.23
0.03
-0.16
-0.12
-0.55

0.27
0.02
-0.21
-0.03
-0.54

0.01
-0.12
-0.03
-0.03
0.22

2631.1

2659.2

2688.4

2676.6

2687.3

2633.5

2750.4

2768.7

-0.10

-0.87

-0.40

0.50

OECD GOVERNMENT-CONTROLLED STOCKS5 AND QUARTERLY STOCK CHANGES

2

RECENT MONTHLY STOCKS

PRIOR YEARS' STOCKS

in Million Barrels

in Million Barrels

STOCK CHANGES
in mb/d

Mar2011

Apr2011

May2011

Jun2011

Jul2011*

Jul2008

Jul2009

Jul2010

North America
Crude
Products

726.5
0.0

726.5
0.0

726.5
0.0

726.5
0.0

718.2
0.0

707.2
2.0

724.1
2.0

726.6
2.0

0.00
0.00

0.00
0.00

0.00
-0.02

0.00
0.00

Europe
Crude
Products

185.9
232.6

185.6
234.5

185.6
234.7

184.9
237.1

183.3
236.8

180.0
231.7

185.6
239.5

185.3
234.7

-0.04
0.00

0.05
-0.01

-0.01
-0.03

-0.01
0.05

Pacific
Crude
Products

391.2
20.0

391.1
20.0

391.1
20.0

391.1
20.0

389.1
18.5

384.2
18.9

388.5
19.2

388.9
20.0

-0.10
0.00

0.08
0.00

0.02
0.00

0.00
0.00

1303.6
252.6

1303.3
254.5

1303.3
254.7

1302.5
257.1

1290.6
255.3

1271.5
252.5

1298.1
260.6

1300.7
256.7

-0.13
0.00

0.13
-0.01

0.01
-0.05

-0.01
0.05

1557.7

1559.2

1559.4

1560.9

1547.3

1525.0

1560.5

1558.8

-0.14

0.12

-0.03

0.04

Total OECD
Crude
Products
Total

3Q2010

4Q2010

1Q2011

2Q2011

* estimated
1 Stocks are primary national territory stocks on land (excluding utility stocks and including pipeline and entrepot stocks where known) and include stocks held by
industry to meet IEA, EU and national emergency reserve commitments and are subject to government control in emergencies.
2 Closing stock levels.
3 Total products includes gasoline, middle distillates, fuel oil and other products.
4 Total includes NGLs, refinery feedstocks, additives/oxygenates and other hydrocarbons.
5 Includes government-owned stocks and stock holding organisation stocks held for emergency purposes.

13 S EPTEMBER 2011

63

T ABLES

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Table 5

1
Table 5 - Total Stocks onTOTAL
LandSTOCKS
in OECD
OECD Stocks
ON Countries/Total
LAND IN OECD COUNTRIES
('millions of barrels' and 'days')

End June 2010 End September 2010

Stock
Level

North America
Canada
Mexico
United States4

Days Fwd2
Demand

End December 2010

End March 2011

End June 2011

Stock Days Fwd

Level Demand

Stock Days Fwd

Level Demand

Stock Days Fwd

Level Demand

Stock Days Fwd

Level Demand

178.4
54.4
1843.6

79
27
95

194.1
49.0
1863.2

85
24
97

194.9
44.5
1796.1

86
22
94

184.9
45.0
1769.5

83
22
94

185.5
46.5
1807.6

2098.5

87

2128.4

89

2057.6

87

2021.5

87

2061.7

87

42.7
597.1
167.3
8.9

45
137
78
59

40.5
581.8
173.5
8.2

41
127
74
53

38.1
588.3
165.4
8.2

39
121
70
51

39.1
575.4
170.2
8.0

39
147
83
53

39.5
593.2
175.2
8.2

816.0

107

804.0

100

800.0

96

792.7

111

816.0

106

20.1
37.8
20.4
29.8
28.5
170.1
280.4
33.9
17.0
12.8
132.5
0.7
138.8
22.1
63.8
24.9
9.3
134.1
35.4
38.1
58.4
96.1

69
62
99
169
134
91
106
98
107
87
84
11
137
107
106
87
99
94
103
148
80
59

18.9
34.3
21.1
26.9
28.5
163.4
285.6
36.3
15.9
11.4
126.6
0.7
120.9
20.8
64.2
22.8
8.6
133.0
34.4
37.7
58.5
94.5

65
51
105
159
121
88
113
95
103
68
81
12
122
77
108
84
101
92
94
146
90
59

19.7
33.6
21.2
26.8
27.8
168.2
286.8
34.3
15.9
9.8
133.3
0.6
125.9
20.8
65.5
22.9
8.3
133.2
32.3
36.8
58.5
88.8

77
50
117
171
127
91
122
92
119
63
93
10
129
81
123
89
109
93
94
156
101
55

19.3
37.0
21.5
21.4
26.9
167.4
289.4
33.9
17.4
10.8
132.2
0.5
125.9
21.1
62.8
23.5
9.0
132.9
33.7
36.6
58.3
92.8

78
59
106
132
133
94
124
106
124
79
90
9
124
96
109
87
111
97
101
168
85
57

19.6
38.1
21.7
21.5
27.2
166.7
290.8
33.4
17.3
10.2
132.2
0.6
119.8
23.5
64.6
23.3
8.9
130.1
30.2
37.2
56.6
86.3

Total

1404.9

94

1365.1

92

1371.0

97

1374.6

98

1359.8

94

Total OECD

4319.3
-

93
146

4297.5
-

92
145

4228.6
-

91
146

4188.7
-

94
146

4237.5
-

147

Total

Pacific
Australia
Japan
Korea
New Zealand
Total

Europe
Austria
Belgium
Czech Republic
Denmark
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Luxembourg
Netherlands
Norway
Poland
Portugal
Slovak Republic

Spain
Sweden
Switzerland
Turkey
United Kingdom

DAYS OF IEA Net Imports

92

1 Total Stocks are industry and government-controlled stocks (see breakdown in table below). Stocks are primary national territory stocks on land (excluding utility stocks
and including pipeline and entrepot stocks where known) they include stocks held by industry to meet IEA, EU and national emergency reserves commitments and are
subject to government control in emergencies.
2 Note that days of forward demand represent the stock level divided by the forward quarter average daily demand and is very different from the days of net
imports used for the calculation of IEA Emergency Reserves.
3 End June 2011 forward demand figures are IEA Secretariat forecasts.
4 US figures exclude US territories. Total includes US territories.
5 Data not available for Iceland.
6 Reflects stock levels and prior calendar year's net imports adjusted according to IEA emergency reserve definitions (see www.iea.org/netimports.asp).
Net exporting IEA countries are excluded.

TOTAL OECD STOCKS

CLOSING STOCKS

Total

2Q2008
3Q2008
4Q2008
1Q2009
2Q2009
3Q2009
4Q2009
1Q2010
2Q2010
3Q2010
4Q2010
1Q2011
2Q2011

4110
4164
4206
4278
4306
4327
4205
4241
4319
4298
4229
4189
4237

Industry
Government
controlled
Millions of Barrels

1526
1522
1527
1547
1561
1564
1564
1567
1562
1549
1561
1558
1561

2584
2641
2679
2731
2745
2763
2641
2675
2757
2748
2668
2631
2677

Total

88
88
90
96
95
94
92
94
93
92
91
94
92

Government
Industry
controlled
2
Days of Fwd. Demand

33
32
33
35
35
34
34
35
34
33
34
35
34

55
56
57
61
61
60
57
59
59
59
58
59
58

1 Includes government-owned stocks and stock holding organisation stocks held for emergency purposes.
2 Days of forward demand calculated using actual demand except in 2Q2011 (when latest forecasts are used).

64

13 S EPTEMBER 2011

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

T ABLES

Table 6

Table 6 - IEA Member Country Destinations of Selected Crude Streams

IEA MEMBER COUNTRY DESTINATIONS OF SELECTED CRUDE STREAMS1

(million barrels per day)

2008 2009 2010

3Q10 4Q10 1Q11 2Q11

Apr 11 May 11 Jun 11

Year Earlier
change
Jun 10

Saudi Light & Extra Light

North America
Europe
Pacific

0.70
0.70
1.22

0.52
0.59
1.28

0.69
0.66
1.21

0.73
0.74
1.15

0.75
0.69
1.26

0.71
0.70
1.33

0.72
0.79
1.14

0.63
0.79
1.25

0.81
0.79
1.10

0.73
0.80
1.08

0.64
0.63
1.08

0.09
0.17
0.00

Saudi Medium
North America
Europe
Pacific

0.64
0.05
0.39

0.40
0.02
0.34

0.36
0.00
0.34

0.33
0.30

0.36
0.37

0.33
0.39

0.36
0.02
0.38

0.32
0.33

0.38
0.02
0.40

0.37
0.05
0.40

0.36
0.40

0.01
0.01

Saudi Heavy
North America
Europe
Pacific

0.07
0.09
0.24

0.03
0.02
0.15

0.02
0.00
0.22

0.03
0.00
0.23

0.01
0.21

0.02
0.00
0.20

0.03
0.00
0.21

0.02
0.22

0.04
0.00
0.18

0.02
0.00
0.22

0.02
0.19

0.00
0.03

Iraqi Basrah Light

North America
Europe
Pacific

0.60
0.21
0.15

0.40
0.12
0.24

0.36
0.09
0.29

0.29
0.13
0.26

0.29
0.08
0.38

0.21
0.03
0.40

0.39
0.10
0.26

0.46
0.01
0.42

0.38
0.14
0.22

0.34
0.14
0.15

0.54
0.15
0.17

-0.20
-0.02
-0.02

Iraqi Kirkuk
North America
Europe
Pacific

0.08
0.23
-

0.06
0.31
-

0.03
0.27
-

0.05
0.25
-

0.04
0.23
-

0.11
0.21
-

0.07
0.31
-

0.05
0.29
-

0.03
0.20
-

0.14
0.44
-

0.29
-

0.15
-

Iranian Light
North America
Europe
Pacific

0.23
0.08

0.15
0.07

0.24
0.04

0.33
0.04

0.18
0.01

0.24
0.06

0.28
0.03

0.36
0.02

0.19
0.04

0.28
0.02

0.27
0.06

0.01
-0.04

0.49
0.61

0.40
0.57

0.49
0.52

0.70
0.53

0.43
0.52

0.34
0.63

0.59
0.41

0.36
0.42

0.59
0.37

0.83
0.44

0.63
0.45

0.20
-0.01

Venezuelan Light & Medium

North America
0.62
Europe
0.06
Pacific

0.39
0.07
-

0.14
0.02
-

0.08
0.05
-

0.16
0.01
-

0.06
0.03
-

0.30
0.01
-

0.12
0.02
-

0.37
-

0.40
0.01
-

0.27
0.01
-

0.13
0.00
-

Venezuelan 22 API and heavier

North America
0.65
Europe
0.07
Pacific
-

0.75
0.07
-

0.86
0.06
-

0.96
0.06
-

0.75
0.05
-

0.89
0.04
-

0.77
0.05
-

0.83
0.04
-

0.71
0.04
-

0.78
0.07
-

0.73
0.04
-

0.06
0.03
-

Mexican Maya
North America
Europe
Pacific

1.02
0.14
-

0.93
0.10
-

0.91
0.11
-

0.94
0.11
-

0.92
0.09
-

0.82
0.14
-

0.80
0.12
-

0.71
0.14
-

0.89
0.13
-

0.79
0.10
-

0.87
0.11
-

-0.08
-0.01
-

Mexican Isthmus
North America
Europe
Pacific

0.01
0.01
-

0.01
0.01
-

0.04
0.02
-

0.02
-

0.09
0.05
-

0.05
0.01
-

0.08
0.02
-

0.09
-

0.01
0.05
-

0.14
-

0.01
0.01
-

0.13
-

Russian Urals
North America
Europe
Pacific

0.05
1.81
-

0.15
1.72
-

0.08
1.80
-

0.08
1.88
-

0.03
1.71
-

0.01
1.76
-

1.87
-

2.05
-

1.96
-

1.60
-

0.15
1.83
-

-0.22
-

Nigerian Light
North America
Europe
Pacific

0.68
0.29
-

0.54
0.32
0.00

0.60
0.34
-

0.64
0.31
-

0.58
0.49
-

0.62
0.40
0.05

0.60
0.40
0.04

0.57
0.27
0.03

0.63
0.54
0.06

0.58
0.40
0.03

0.74
0.26
-

-0.16
0.14
-

Nigerian Medium
North America
Europe
Pacific

0.27
0.14
-

0.21
0.13
-

0.25
0.09
-

0.25
0.09
-

0.22
0.11
-

0.20
0.14
-

0.18
0.17
-

0.24
0.14
-

0.08
0.12
-

0.23
0.24
-

0.29
0.10
-

-0.06
0.14
-

Iranian Heavy
North America
Europe
Pacific

1 Data based on monthly submissions from IEA countries to the crude oil import register (in '000 bbl), subject to availability. May differ from Table 8 of the Report.
IEA North America includes United States and Canada.
IEA Europe includes all countries in OECD Europe except Hungary. The Slovak Republic and Poland is excluded through December 2007 but included thereafter.
IEA Pacific data includes Australia, New Zealand, Korea and Japan.
2 Iraqi Total minus Kirkuk.
3 Iranian Total minus Iranian Light.
4 33 API and lighter (e.g., Bonny Light, Escravos, Qua Iboe and Oso Condensate).

13 S EPTEMBER 2011

65

T ABLES

I NTERNATIONAL E NERGY A GENCY O IL M ARKET R EPORT

Table 7

Table 7 - Regional OECD Imports

REGIONAL OECD IMPORTS1,2

(thousand barrels per day)

Refining Margins in Major Refining Centres

2008
Crude Oil
North America
Europe
Pacific
Total OECD

2009

Apr-11 May-11 Jun-11

Year Earlier
Jun-10 % change

2010

3Q10

4Q10

1Q11

2Q11

8076 7353
7346
9776 8893
9076
6605 6082
6244
24457 22329 22665

7745
9463
6159
23367

6625
9110
6472
22207

6571
8901
6647
22119

6934
8949
6057
21940

6722
8426
6491
21638

6991
9001
5615
21608

7087
9418
6081
22586

7960
9769
5559
23503

-11%
-4%
9%
-4%

LPG
North America
Europe
Pacific
Total OECD

31
268
589
887

13
260
529
802

8
270
558
836

7
226
533
766

6
299
567
872

21
313
569
904

4
285
547
837

6
298
651
955

6
250
543
799

1
309
447
758

10
231
684
925

-88%
34%
-35%
-18%

Naphtha
North America
Europe
Pacific
Total OECD

56
298
776
1130

22
352
841
1215

36
390
900
1326

59
345
855
1260

35
382
893
1309

34
292
917
1243

51
354
830
1235

22
346
757
1124

62
324
875
1260

70
393
856
1319

36
379
877
1292

95%
4%
-2%
2%

Gasoline
North America
Europe
Pacific
Total OECD

1077
215
90
1383

878
193
96
1167

789
174
64
1026

926
207
44
1177

712
127
67
907

668
223
71
961

982
243
61
1286

883
161
76
1121

1110
261
55
1426

948
307
51
1306

862
156
56
1074

10%
97%
-9%
22%

Jet & Kerosene

North America
Europe
Pacific
Total OECD

64
401
34
500

62
452
53
567

76
417
40
532

86
475
29
590

89
396
46
531

62
320
58
440

85
362
43
489

95
412
48
554

79
304
31
414

80
372
51
503

63
356
28
447

28%
4%
85%
13%

Gasoil/Diesel
North America
Europe
Pacific
Total OECD

74
871
119
1064

55
1035
87
1177

49
1045
97
1191

27
934
88
1049

14
1235
92
1340

46
1078
99
1224

30
963
153
1146

40
1094
201
1336

35
917
133
1085

16
879
125
1020

58
775
135
967

-72%
13%
-8%
5%

Heavy Fuel Oil

North America
Europe
Pacific
Total OECD

288
458
125
871

270
534
113
917

277
529
117
923

285
504
127
915

254
504
101
859

345
505
147
997

305
606
111
1021

430
537
130
1097

179
627
98
904

309
651
104
1065

202
545
59
807

53%
20%
75%
32%

Other Products
North America
Europe
Pacific
Total OECD

1078
734
298
2110

870
770
325
1964

805
666
335
1806

852
699
382
1932

906
737
352
1996

855
683
383
1921

896
770
252
1917

957
809
300
2066

862
762
233
1856

869
739
223
1831

709
639
327
1675

23%
16%
-32%
9%

Total Products
North America
Europe
Pacific
Total OECD

2667
3245
2032
7944

2171
3595
2045
7810

2039
3491
2111
7640

2241
3390
2059
7689

2017
3680
2118
7814

2032
3415
2244
7690

2353
3582
1995
7930

2432
3657
2163
8252

2334
3444
1966
7744

2294
3650
1858
7802

1940
3081
2167
7187

18%
18%
-14%
9%

10743 9524
9385
13022 12488 12567
8637 8127
8354
32401 30139 30306

9985
12853
8218
31056

8641
12790
8590
30021

8603
12316
8890
29809

9287
12531
8053
29871

9154
12083
8653
29891

9325
12445
7581
29352

9381
13068
7939
30388

10115
12849
7725
30690

-7%
2%
3%
-1%

Total Oil
North America
Europe
Pacific
Total OECD

1 Based on Monthly Oil Questionnaire data submitted by OECD countries in tonnes and converted to barrels.
2 Excludes intra-regional trade.
3 Includes additives.

66

13 S EPTEMBER 2011

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