OPEC expects higher demand for its oil in 2016; Saudis pump less in Oct

Global demand for oil and OPEC’s crude stocks are projected to see higher demand next year at an average of 94.14 million barrels per day (mbd) and 30.8 mbd in 2016, respectively, the producer group said in its latest monthly report.

Demand predictions for 2016 are based on a modest economic outlook amid slowing momentum in China, as Russia and Brazil are also expected to see a declining trend.

“World economic growth remains modest, mainly due to a continued slowdown in emerging and developing economies, as well as low US growth in the third quarter,” the cartel said in the report.

Saudi Arabia, the world’s largest oil exporter, pumped 10.28 mbd last month, down 50,000 bpd month-on-month, based on the kingdom’s estimates. According to secondary sources, however, the country’s output fell by 72,200 bpd to 10.13 mbd over the period.

OPEC, which pumps about a third of the world’s crude, saw its output decline by 256,000 bpd in October to average 31.38 mbd as output has declined in Iraq, Saudi Arabia, and Kuwait. The drop led the group to witness a 0.3 percent fall in its share of global production.

Global oil supply dropped by 0.09 mbd to average 94.13 mbd month-on-month.

Non-OPEC oil supply is estimated to average 57.11 mbd in 2016, marking a contraction of 0.13 mbd.

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com