EIA projects slightly higher global oil demand growth

Worldwide liquids fuels consumption will grow by 800,000 b/d this year and by 900,000 b/d in 2013, according to the latest outlook from the US Energy Information Administration. In last month’s Short-Term Energy Outlook (STEO), EIA projected that global oil demand would climb by 700,000 b/d during both 2012 and 2013.

The new outlook for this year sees China, the Middle East, Central and South America, and other countries outside of the Organization for Economic Cooperation and Development accounting for nearly all consumption growth. Projected OECD liquid fuels consumption will decline by 430,000 b/d in 2012 and by 130,000 b/d in 2013.

EIA expects that OPEC members will continue to produce more than 30 million b/d of crude oil over the next 2 years to accommodate the projected increase in worldwide oil consumption and to counterbalance supply disruptions. Projected OPEC crude oil production will increase by about 900,000 b/d in 2012 and then remain flat in 2013 as non-OPEC supply growth increases and stocks rise slightly.

Iran’s crude oil production will fall by about 1 million b/d by the end of 2012 from estimated output of 3.6 million b/d at the end of 2011, and by an additional 200,000 b/d next year not only due to sanctions but also due to the country’s inability to make the investments necessary to offset natural production decline from existing wells, EIA said.

Non-OPEC production is forecast to increase by 600,000 b/d this year and by 1.3 million b/d in 2013. The area with the most growth will be North America, where production will climb by 940,000 b/d this year and by 440,000 b/d next year.

EIA expects that Kazakhstan, which will commence commercial production in Kashagan field next year, will increase its total production by 200,000 b/d in 2013. In Brazil, output is projected to rise by 140,000 b/d in 2013, with increased output from its offshore, presalt oil fields. Forecast production also will rise in China, Russia, and Colombia over the next 2 years, while production declines in Mexico and the North Sea, according to the STEO.