IEA Raises 2023 Oil Supply Deficit On OPEC+ Cuts

IEA has raised its 2023 oil supply deficit to 800kbpd, as the OPEC+ supply cuts will deepen the risk of a supply deficit and boosting oil prices and risk boosting oil prices according to the IEA Monthly Oil Market Report.

• The output cuts, announced by OPEC+, will push world oil supply down by 400kbpd by end-2023. Global oil production growth this year is forecast to slow to 1.2mbpd, compared with 4.6mbpd in 2022.
• IEA expects non-OPEC+ to drive global oil supply growth by 1.9mbpd, while OPEC+ supply is expected to drop by 760kbpd.
• IEA revised down its global oil demand growth forecast by 100kbpd to 109mbpd, with non OEC demand accounting for 87% of the growth.
• Global oil demand in the first quarter of this year stood at 104mbpd, up by 810kbpd year on year, amid a rebound in Chinese demand and a rebound in international travel.
• OECD demand declined by 390kbpd in 1Q23 because of weak industrial activity and warm weather, marking the second consecutive quarter of decline.
• IEA expects 2023 global refining throughout 0.1mbpd lower month on month to average 82mbpd due to weaker 1Q23 data. On average 2023 crude runs will approach pre-covid levels but remain 0.3mbpd below the 2019 average throughputs.
• Russian oil exports in March rose to 8.1mbpd, up by 0.6mbpd, and the highest level since April 2020.
• Crude prices rebounded modestly following the release of the IEA OMR but continued to trade below the session’s opening.
  • Brent JUN 23 down -0.1% at 85.98$/bbl
  • WTI MAY 23 down -0.1% at 82.11$/bbl