Oil Marketing Report From IEA March 2023 - Anand Rathi Analysis
OECD Stock At Five-Year Average; Brent To Fall Further To $73/bbl Or Lower
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Anand Rathi Report
Global oil demand in 2023 is set to rise by 2 million barrels per day to 102 million. Asia-Pacific and China would command most of the growth.
Jet/kerosene demand (at ~91% of 2019 levels) is expected to increase on rebounding air traffic and pent-up China demand. World oil supply rose in February 2023 to 101.5 million barrels per day, versus 100.8 million the month prior.
(The rise comes from rebounding supplies from the U.S. and Canada after winter storms and outages.) Global supply in 2023 is expected from non- Organization of the Petroleum Exporting Countries adding 1.6 million barrels per day to a well-supplied H1 2023.
Global refinery throughput fell further to 81.1 million barrels per day versus the previous month’s 83.4 million, with the U.S. still recovering from outages and maintenance shutdowns.
(A drop was expected in Feb for scheduled maintenance, already highlighted in their last report).
The IEA expects 2023 runs to average 82.1 million barrels per day (up 1.8 million YoY).
OECD stocks at 2,851 million barrels, an 18-month high (versus 2,767 million in Jan-23), are near a five-year average of 2,865 million, a huge indication of Brent prices falling.
U.S., Europe and Japan data show a build of 7.8 million barrels in Feb-23. Our calculation shows average Brent prices based on OECD stock levels till our next month’s report have a mere 1% variance. At present stock levels, we arrive at a price of $73 a barrel.
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