OPEC to cut exports on lower Asian demand
HALIFAX, United Kingdom (Bloomberg) -- The Organization of Petroleum Exporting Countries will curtail exports through mid-April in response to lower seasonal demand from refiners in Asia, according to tanker-tracker Oil Movements.
OPEC, responsible for 40% of global oil supplies, will reduce shipments by 620,000 bopd, or 2.5%, to 23.78 million a day in the four weeks to April 12, the researcher said in an emailed note. The figures exclude two of OPEC’s 12 members, Angola and Ecuador.
“Heading into April, there’s a very clear reason to expect a fall,” Oil Movements founder Roy Mason said by phone from Halifax, England. “We’re moving past a winter peak, which happened in February. In the second quarter, crude demand will be lower based on refinery runs. The east is heading into maintenance.”
Global oil consumption typically ebbs at the end of the first quarter as demand for heating fuel tapers off and refiners start to perform routine overhauls. Brent crude slipped 1.4% this month, trading at $107.55 a barrel on the ICE Futures Europe exchange as of 2:55 p.m. London time.
Middle Eastern exports will average 17.43 MMbpd in the four weeks to April 12, compared with 17.93 MMbpd in the period to March 15, Oil Movements said. These figures include non-OPEC nations Oman and Yemen.
Crude on board tankers will drop by 1.6% to 489.21 MMbbl in the four weeks to April 12, from 496.93 million in the previous period, data from Oil Movements show. The researcher calculates volumes by tallying tanker bookings and excludes crude held on vessels for storage.
“There has been a very big build in oil-in-transit over the winter,” Mason said. “That’s oil that’s on the water and has to find a home, and it hasn’t hit land yet. There’s a lot of oil there which will arrive in the next two months.”
OPEC’s members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. The group will next meet on June 11 at its headquarters in Vienna.