World oil demand will reach a record 102.2 million barrels per day in 2023, 2.2 million barrels per day more than last year, the International Energy Agency (IEA) forecast on Friday.
In the monthly report on the world oil market, the IEA points out that the world demand for crude oil already reached a record of 102 million barrels per day in June.
This increase in demand is fueled by increased air travel in the summer, increased use of oil in power production, and increased activity in the Chinese petrochemical industry.
China is responsible for more than 70% of the increase in demand. Demand fell slightly in July, to 100.9 million barrels per day, but the EIA notes that it “could set a new record in August”, closing the year at 102.2 million barrels per day, a value never seen before in all of the world. one year.
However, the report predicts that demand growth will be limited to one million barrels per day by 2024, due to the global economic slowdown, increased energy efficiency and the growth of electric vehicles.
This surge in demand was coupled with production cuts by OPEC and its allies (OPEC+), led by Saudi Arabia, which took effect in July.
Last month, the block’s crude output fell to 50.7 million barrels a day, more than 2 million barrels a day less than at the start of the year.
Countries outside the alliance increased their production by 1.6 million barrels per day to 50.2 million barrels per day, led by the US, Brazil and Guyana.
The United States is responsible for 70% of this production growth. The increase in demand and the reduction in supply combined to obtain, as a first result, a “sharp” drop in global stocks, says the report.
World oil reserves fell in June for the third consecutive month, with OECD countries standing 115.4 million barrels below the five-year average.
Preliminary data suggests that inventories also fell in July and early August. This combination of high demand from economic activity and the belief that central banks will not raise interest rates any further, lower inventories, subdued inflation and production cuts, combined with a weaker dollar, has pushed prices higher. hard.
Brent crude prices rose $11 in July to end the month at $85.73 a barrel, the highest level since April.
As for Russia, its oil exports remained stable at around 7.3 million barrels per day in July, with China and India accounting for 80% of this volume.
Rising prices and narrowing discounts on Russian oil saw Moscow’s export earnings rise by $2.5 billion to $15.3 billion in that month, but still $4.1 billion less than a year ago.
Source: TSF
